If a paragraph begins with a short sentence that is less than a full line and that introduces a block quotation, should the block quotation be further indented than usual?
No. All block quotations in your work should be indented the same amount. Even if the block quotation occurs after a short line that is itself indented at the beginning of a paragraph, indent the block quotation as you normally would. The following provides an example:
For Ngũgĩ wa Thiong’o,
African writers are haunted by their past simply because the historical narratives that they thought would make their experiences more intelligible have instead confronted them with the opacity of the past. The turn to fiction, then, is one important way of clarifying the confusions created by historical events. . . . (Gikandi 3)
Gikandi, Simon. Ngugi wa Thiong’o. Cambridge UP, 2000. ACLS Humanities E-book, hdl.handle.net/2027/fulcrum.12579s61p.