I don't know about you, but I'm a sucker for a good embedded narrative. An embedded narrative is a story within a story, often used for expository purposes. These stories work well in folksy narratives. Stephen King's works are riddled with secondary speculations that color character and advance narrative. Salem's Lot, Needful Things, Bag of Bones, Duma Key--these novels make good advantage of this practice and would serve as useful examples if you're in the market for a longer read.
And there's the rub if you're writing a novel. How long should I go with this? Well, by all accounts King's work is far longer than the industry average (which seems to be trending toward slimmer books). His next novel is projected to round out the first draft at 1800 pages.
That's right, 1800 pages. Not a typo there, folks.
And, admittedly, the man has free reign to take his time. It's his style, and I imagine that his publishers love it. But what about the rest of us, who've been told time and time again to keep it moving? Well, I try to keep the embedded narratives short and sweet. I don't dally over chapters, though that's ok if you do. I've found that most of my use of this technique is contained to a few short paragraphs, and usually it's weighted toward the first third of the text.
Have a character with a short temper? Tell a story about a time he or she lost it (i.e. Greg Stillson in King's The Dead Zone; he kicks a dog to death). Got a character with a fragile ego. Illustrate a time in the character's life when he or she was berated (Carrie gets pelted pretty good with tampons early on in Carrie, though I can't remember if that's an embedded narrative or an actual plot point).
I'm reminded of another quote from a King short story: It's the tale, not he who tells it. Don't lose sight of that little nugget of truth as you're developing your characters.
They have things to say. They have life experiences. Those embedded narratives are the way to let them shine through on the page...
I'd love any input from those writing this type of thing. Also, readers--yea or nay on the embedded narrative? Any examples?
By the way, for a textbook example of the embedded narrative (and a foundational horror text in its own right) I recommend Straub's Ghost Story. Those fellows in the Chowder Society have that story-telling thing down to a science.