How to Loop within a Loop (Display Children and then Grandchildren)

I am trying to develop a query for WordPress that will allow me to display a list of child pages with titles only, and then under each child page title, a list of grandchilden (children of the child) page titles AND their content.

So for example, the output should be something like this:

<ul>
  <li>
    <h1>Page 1</h1>
    <ul>
      <li>
        <h2>Child Page 1</h2>
      </li>
      <li>
        <h2>Child Page 2</h2>
        <ul>
          <li>
            <h3>Grandchild</h3>
            <p>Hello, welcome to this grandchild page</p>
          </li>
          <li>
            <h3>Grandchild #2</h3>
            <p>Hello, welcome to this grandchild page</p>
          </li>
        </ul>
      </li>
      <li>
        <h2>Child Page 3</h2>
      </li>
    </ul>
  </li>
  <li>
    <h1>Page 2</h1>
  </li>
</ul>

It needs to be done dynamically, meaning I do not want to specify the post ID number as part of the query.

I have tried using a standard WordPress Query and then nesting a second query within the first one – this failed.

In addition, I also tried modifying the code seen here: http://wordpress.org/support/topic/query-child-pages-of-a-current-page-and-loop-through-each-child-page

Finally, I also tried to modify this code:

<?php if ( have_posts() ) {  while ( have_posts() ) { the_post(); $thispage=$post->ID; }} ?>
<?php $childpages = query_posts('post_per_page=3&orderby=menu_order&order=asc&post_type=' . get_post_type( $post->ID ) . '&post_parent='.$thispage);
    if($childpages){ /* display the children content  */
            foreach ($childpages as $post) :
            setup_postdata($post); ?>
          <li><a class="" href="#<?php echo($post->post_name) ?>">
            <?php the_title(); ?>
            </a></li>
          <?php
      endforeach;
     } ?>

I’ve been trying to get this working for more than a day now and i’m just going around in circles really.

Would very much appreciate help in getting this working.