I am not WORDPRESS expert nor i do not know much about .htaccess or Scripting; but i find hardway to fix the Problem.
I have been using WordPress for last 10 years; and i have Dozens of sites/blogs with subdomain and with directory structure etc etc.
Nowadays you will not find solution in wordpress forum nor wordpress team answer correctly.
in one of my Problem they argued such never works for WordPress, but it works for me.
recently i was having problem with wp-admin which was giving “This webpage has a redirect loop”
most of the Answer for this Clear your Cache;
Disable your .htaccess bla bla
but nothing works than my Good old .htaccess file which i am using for decades which WORDPRESS team deny to work properly on any sites.
You can try below .htaccess, this file i was using when i was using wp-mu
—-COPY FROM HERE —
RewriteEngine On
RewriteBase /
#uploaded files
RewriteRule ^(.*/)?files/$ index.php [L]
RewriteCond %{REQUEST_URI} !.*wp-content/plugins.*
RewriteRule ^(.*/)?files/(.*) wp-includes/ms-files.php?file=$2 [L]
# add a trailing slash to /wp-admin
RewriteCond %{REQUEST_URI} ^.*/wp-admin$
RewriteRule ^(.+)$ $1/ [R=301,L]
RewriteCond %{REQUEST_FILENAME} -f [OR]
RewriteCond %{REQUEST_FILENAME} -d
RewriteRule . – [L]
RewriteRule ^([_0-9a-zA-Z-]+/)?(wp-.*) $2 [L]
RewriteRule ^([_0-9a-zA-Z-]+/)?(.*\.php)$ $2 [L]
RewriteRule . index.php [L]
— END —
Let me if its works.