Hello
You mention "model" then "layout" (a left over from Autocad I think). There are some circumstances where it can be useful to use self referencing. But in the example you mention, the generally accepted (certainly here in the UK) Microstation "way of doing things", is to keep the models (often called design files) separate from the Sheet files ( = layout; Microstation users and companies generally don't work in terms of modelspace and paperspace). Typically all the design files are in one folder (or folders) and the Sheet files in a separate folder (or folders). The design files (there may be several of them referenced in to each other to make the finished piece of work; example: structure.dgn, cladding.dgn, internal.dgn, ....) are then referenced in to a Sheet file, which has a border referenced in at the required scale. Each Sheet file (= drawing) should only contain 1 drawing. Typically you would have several folders: 1:100 ;1:50 and so on. The same design files should be used with different drawing sheets. Each time you have a slightly different arrangement of Level ON/OFF, hatching/patterns, annotations which are appropriate to that particular type of drawing.
For the time being, I would avoid using self referencing if possible and leave that until you are more familiar with the Microstation "way of doing things".
Hope that is a least a bit clearer.
Regards
Danny Cooley