I am currently in the process of converting one of our projects to Gradle from maven. The folder structure is as follows:
gitRoot
settings.gradle
bui
This isn't the answer that you are looking for, but...
I spent about 4 days trying to migrate my complex project structure (much like yours actually), into gradle. In the end, I ditched the entire sub-project concept (since in my case, it just didn't work), and I opted to use the local maven repository approach, as described in this article: http://www.flexlabs.org/2013/06/using-local-aar-android-library-packages-in-gradle-builds
So, in my Library projects that had sub-projects, I basically created complete library projects for each of those, and then I used the link above to publish those to the maven local repository. Then in the parent project, I removed any references to sub projects, and in the dependencies, I just referenced the published libraries. And then in my main project, I removed all references to sub-projects, and I referenced published maven local versions of my libraries.
In the end, it all works very well, but it did take some time to convert everything over. I had about 6 library projects with sub projects, that that sub projects, etc, and now everything works fine.
The thing that I dislike about systems like Gradle and Maven is that they really expect you to change "how" you structure your code/projects. So, if you are migrating to Gradle vs starting with Gradle, then the process can be quite frustrating. Once you figure it out though, the next time is much easier ;)