There is no need to limit the chain rule to two links. You can use substitutions and the chain rule as extensively as you want to simplify a problem. Personally, I like to make the substitutions and steps explicit because it helps me avoid mistakes.
\(\displaystyle [\alpha]\ y = \sqrt{\sqrt{1 +\sqrt{x}} - 1}.\)
\(\displaystyle [\beta]\ Let\ u = \sqrt{1 + \sqrt{x}} - 1 \implies y = \sqrt{u} = u ^{(1/2)} \implies \dfrac{dy}{du} = \dfrac{1}{2} * u^{-(1/2)} = \dfrac{1}{2\sqrt{u}}.\) Hard to make a mistake there.
\(\displaystyle [\gamma]\ Let\ v = 1 + \sqrt{x} \implies u = \sqrt{v} - 1 \implies \dfrac{du}{dv} = \dfrac{1}{2\sqrt{v}} - 0 = \dfrac{1}{2\sqrt{v}}.\) Again, very easy.
\(\displaystyle [\delta]\ And\ v = 1 + \sqrt{x} \implies \dfrac{dv}{dx} = \dfrac{1}{\sqrt{x}}.\) Not a problem in the world to do.
Now apply the chain rule:
\(\displaystyle [\epsilon]\ \dfrac{dy}{dx} = \dfrac{dy}{du} * \dfrac{du}{dv} * \dfrac{dv}{dx} = \dfrac{1}{2\sqrt{u}} * \dfrac{1}{2\sqrt{v}} * \dfrac{1}{2\sqrt{x}} = \dfrac{1}{8\sqrt{u} * \sqrt{v} * \sqrt{x}} = \dfrac{1}{8\sqrt{uvx}}.\) Again, super simple. Hard to make a mistake.
Now, using gamma, delta, and epsilon, reverse the substitutions.
\(\displaystyle \dfrac{dy}{dx} = \dfrac{1}{8\sqrt{uvx}} = \dfrac{1}{8\sqrt{x(1+ \sqrt{x})(\sqrt{v} - 1)}} = \dfrac{1}{8\sqrt{x(1 + \sqrt{x})(\sqrt{1 + x} - 1)}}.\) Not hard at all.
No step in this method of explicit substitution and chain rule is hard, but the method is lengthy and looks inelegant. As I said, it removes the mystery and prevents errors.