Hi Irene,
While your intentions are good, you have inadvertently created a chronic breeding situation for her or him. In the wild, birds do not sleep in anything – they don’t need a nest, or anything else to use as a bed. A nest is something that is necessary only during breeding season and then it is abandoned until breeding season the next year. So what you view as a bed, she views as a nest. Even a male will do this. Based on your description, your bird could be either sex. Since she hasn’t laid eggs, then you more likely have a male. Either way, you need to remove the nest and discard it. This is the best way to handle it. Give her some extra toys or treats or both, but do not give in and give her a nest or anything she can get inside of. She will sleep on a perch or possibly a corner of the cage on the bottom. This is natural for her and you are not being mean. You are actually doing the bird a favor because right now she is in a constant hormonal state and this isn’t healthy. We have learned so much about how to care for our birds and how to deal with behavioral issues, and it always comes back to learning from their wild counterparts.
Thank you for asking Lafeber,
Brenda