[eluser]Xeoncross[/eluser]
Code:
/root
/sub1/application
/controllers
/models
/views
/sub2/application
/controllers
/models
/views
You could probably get Matchbox or HMVC to fix this problem - but if you want to work with CORE CI stock then I would just place the ENTIRE CI system in each subdomain so that none of the changes you make to other sub-domains affect the rest of the system.
Setup a SVN or something that contains the "common" parts that you know EVERY domain will need and then just have the domains update to that version with each commit. Then keep separate branches or projects for just the stuff for that particular sub-domain.
Of course you could also get a host that works and just use Apache configs to solve this problem.