Back again with the Loki comic currently running. First the Snowman, Frostï, now the nightmares.
Basically what's happening is Nightmare is showing Loki's greatest fear, the fear that he's still inside his father's stomach, slowly decomposing in the acid. It's not as fleshy as
you'd imagine, considering normal human in giants stomach that's full of stomach acid, but it's something.
Spoiler boxed to prevent screen stretching/computer chugging
(And for those wondering, unfortunately no, these are all the scenes in the comic with this plot point. Loki headbutts Nightmare with his gold horn headpiece and knocks it back to reality.)
(Though considering this is the second time this is a plot point, the rest of the comic,written by Daniel Kibblesmith, might put in a third instance for the rule of three.)