The urban-rural relationship in China has undergone distinct stages, broadly categorized as follows: coordinated development and rural-urban integration. During the initial phase of rural-urban integration, certain townships pursued collaboration with cities possessing high-scale functional zones, aiming to gain increased autonomy in economic management. This approach facilitated the expansion of high-scale functional zones from cities to rural regions. The evolving urban-rural relationship in China has led to an intricate socio-spatial structure characterized by an overlap of high- and low-scale functional zones, forming an embedded complex. Although the TPSN (Territory-Place-Scale-Network) model offers a valuable framework for describing the changing dimensions of this structure, it fails to explain the causative factors behind these changes or accurately delineate the process of such transformations. Hence, we employed the ASID (Agency-Structure-Institution-Discourse) framework as an analytical tool to examine the two stages of the Guangzhou-Qingyuan Economic Special Cooperation Zone (GQESCZ) as a case study. Results of this study revealed that GQESCZ exhibited a pronounced embedded complex. The high-scale Guangzhou Development Zone (a national-level economic development zone) is nested within several township-level administrative regions of Qingyuan. In the first stage of GQESCZ, Qingyuan, serving as a superior government to Yingde, operated as a local leader, akin to the roles played by Foshan and Guangdong. Its objective was to facilitate the development of a cooperation zone and enhance regional public interests. However, during the second stage of GQESCZ, both Qingyuan and Guangzhou took on the roles of institutional actors and underwent significant identity changes. Qingyuan exhibited varying actor roles throughout different stages of urban-rural integration, emphasizing how actor categories evolved in line with their objectives. The various actor categories involved in spatial production served as strategic tools for achieving their respective objectives. Also, we found that hegemonic discourse generated a heightened sense of political responsibility within the Guangdong provincial government, thus elevating expectations for urban-rural integration projects. To meet these provincial government aspirations, both Guangzhou and Qingyuan opted to undertake urban-rural integration projects in well-established industrial parks. To mitigate the risk of project failure, the Guangdong provincial government has delegated significant authority to the municipal governments responsible for these projects. This delegation allocated responsibilities and powers between the provincial and municipal levels. Provincial governments simultaneously transferred both power and responsibility to local governments, aiming to minimize the accountability risks associated with these projects. Furthermore, this approach provided substantial authorization, enabling local governments to execute urban-rural integration projects to high standards. Importantly, during the formation of the embedded complex in GQESCZ, both the Guangdong provincial and local governments displayed a clear preference for blame-avoidance. An effective role is never played by specific socio-spatial forms but rather by social actors who are embedded within and utilize these spatial forms. This realization emphasizes that, in the study of social spatial theory, the significance of a specific socio-spatial form can only be assessed from the perspective of the participating actors. This study analyzed the production process of social space from the perspective of the local government's blame-avoidance preference, thus bridging the gap between socio-spatial theory and blame-avoidance game theory. Findings of this study indicate the importance of fostering diverse forms of intercity cooperation, thereby capitalizing on the adaptability offered by flexible spatial delineation methods, such as embedded complexes. This approach facilitates the expansion of cross-boundary governance overseen by core city governments and supports the re-territorialization of urban capital. Simultaneously, it is crucial to proactively employ rigid measures, such as administrative division adjustments, to safeguard the accomplishments of institutional reforms stemming from embedded complexes.