Syntax of INNER JOIN nested inside OUTER JOIN vs. query results
If you look at the 2 execution plans, is there an easy answer to which is better? I purposefully did NOT create indexes so it's easier to see what's happening.


The second plan has a lower estimated cost, so in that limited sense it is 'better'.

The data sets are so small that the optimizer did not spend much time looking at alternatives. The first form of the query happens to find a plan using hash join and a table spool early on. The estimated cost of that plan is so low that the optimizer does not bother looking for anything better.

The second form of the query happens to find a plan using only nested loops outer joins early in the search process, and again the optimizer decides that plan is good enough. It so happens that this plan is estimated to be cheaper.

That said (as mentioned in the question comments) the two queries are not semantically identical. This may not be important to you if you can guarantee that the results will always be the same for all possible future states of your database, but the optimizer cannot make that assumption. It only ever produces plans that are guaranteed to produce the same results specified by the SQL, in all circumstances.


  I have realized that the nested syntax also modifies the behaviour of the query.


The 'nested syntax' is just one aspect of the whole ANSI join syntax specification. To enable a full logical specification for more complex join patterns, the specification allows (optional) parentheses, and FROM clause subqueries.

The query can be written using the same ANSI syntax using parentheses:

SELECT
    A.*,
    M.*,
    N.* 
FROM dbo.Autos AS A
LEFT JOIN
(
    dbo.Manufacturers AS N
    JOIN dbo.Models AS M
        ON M.ManufacturerID = N.ManufacturerID
) ON M.ModelID = A.ModelID;


This form clearly shows that the logical requirement is to left join from Autos to the result of inner joining Manufacturers to Models. Omitting the optional parentheses gives the form you call 'nested':

SELECT
    A.*,
    M.*,
    N.* 
FROM dbo.Autos AS A
LEFT JOIN dbo.Manufacturers AS N
JOIN dbo.Models AS M
    ON M.ManufacturerID = N.ManufacturerID
    ON M.ModelID = A.ModelID;


This is not a different syntax - it is just omitting optional parentheses and reformatting a bit.

As Martin mentioned, it is also possible in this case to express the logical requirement using inner joins followed by a right outer join:

SELECT
    A.*,
    M.*,
    N.* 
FROM dbo.Manufacturers AS N
JOIN dbo.Models AS M
    ON M.ManufacturerID = N.ManufacturerID
RIGHT JOIN dbo.Autos AS A
    ON A.ModelID = M.ModelID;


All three query forms above use the same ANSI join syntax. All three also happen to produce the same physical execution plan with the data set provided:



As I mentioned in my answer to your previous question, queries that express exactly the same logical requirement will not always produce the same execution plan. Which logical query form you prefer to use is largely a question of style. There is no correlation between one particular style and 'better' query plans in general. I would generally advise against rewriting a query to get a particular plan if the new query is not genuinely logically identical to the original.

The SQL standard also allows FROM clause subqueries, so yet another way to write the same query specification is:

SELECT * 
FROM dbo.Autos AS A
LEFT JOIN
(
    SELECT
        N.ManufacturerID,
        ManufacturerName = N.Name,
        M.ModelID,
        ModelName = M.Name
    FROM dbo.Manufacturers AS N
    JOIN dbo.Models AS M
        ON M.ManufacturerID = N.ManufacturerID
) AS R1
    ON R1.ModelID = A.ModelID;



  Using the traditional syntax, we have to change the join to `Manufacturers to an outer join, like so... but this changes the query plan.


This probably changes the meaning of the query, in which case it is technically not a valid alternative (but see ypercube's  comment on your question).

The (optional) parentheses in the ANSI join syntax are there precisely for more complex join requirements like this, so you should not be afraid to use them where necessary.