Europe. It's a melting pot, always has been. There are lots of flexible definitions of nationality.
> their outlook on these matters is striking and confused
Specifically are you referring to the outlook of politicians, the media, or some other entity? I know you started with 'the British' but surely you're not making sweeping generalisations about the 60 million people who live in the UK. That would be a wee bit racist don't you think?
Identity in social science is a complex matter and trying to attack it with "most" is at best inaccurate. Please read the article on identity negotiation which will shed light to the picture.
[1] http://en.wikipedia.org/wiki/Identity_negotiation
PS: I'm not RTFM-ing you, it's just a topic that I'm not qualified to address myself, even though I know it's complex.
Also, since they are not "allowed" to disavow their Moroccan nationality, virtually all Moroccans remain Moroccan, even in later generations.