Hi,
I’m also getting this issue. 2 level navs (in top menu) don’t work.
I have recently updated WP to 3.5, but am not sure if that is the issue, as I don’t think it worked before either.
The second-level UL has class “sub-menu”, but that’s all the markup that appears to be different from a single-level menu.
Not a massive problem as I don’t need drop-downs for this site, but I’ll probably be using this theme a lot in future, so would like to have the option ??
Meanwhile, I hope the work for the next version is coming along well… The bootswatch options in the latest build are excellent – will be great once they’re completed.