I ran into an issue where a package had it's own node_modules, and webpack was ignoring it and instead trying to bundle the package from the root node_modules (which made it error in my case). The reason this happens is because when resolve.modules is an absolute path, it will no longer resolve nested node_modules.
The relevant piece of code is in lib/common/options.js:
// Populate modulesDir
options.modulesDir = []
.concat(join(options.nuxtDir, 'node_modules'))
.concat(options.modulesDir)
.filter(dir => hasValue(dir))
.map(dir => resolve(options.rootDir, dir))
To test this, I added options.modulesDir.unshift("node_modules");
at the end of this for webpack to prioritize nested node_modules.
I'm not entirely sure what commit introduced this bug, as this was working fine in 1.0.0-gh-b31b0f2
and broke in the latest 1.0.0
.