I was able to deploy on digital ocean using the sub domain approach from Nginx Docs
Currently, I am running Strapi and a NextJS frontend on the same Droplet.
Strapi is at api.domain.com and the frontend at domain.com.
It looks like you are trying for the sub folder approach. Not sure of all the differences between this and the approach I used.
If you are still looking for a solution I can post my sites-available and other details. Its just a lot of stuff and I don’t want to waste time if you already have this figured out.