Instantiate a prefab and clone a cube in the prefab hundreds of times = 5 draw calls. Do the same thing again = thousands of draw calls?

Hey!

I have a GameObject prefab (Empty except for some scripts) that has a single child object (a cube, also a prefab).

I can instantiate the main prefab in my level and then instantiate the cube hundreds of times and I get 5 draw calls.

However, if I repeat the same exact thing, I end up getting thousands of drawcalls (one for each cube). Any ideas?

       GameObject tempCubeset = ( GameObject ) Instantiate( cubeSetPrefab , new Vector3( 0.5f , -11.5f , 0.5f ) , Quaternion.Euler( 0 , 0 , 0 ) );
       tempCubeset.transform.GetChild( 0 ).gameObject.renderer.material = new Material( Shader.Find( "Transparent/Diffuse" ) );
 
       for ( int i = 0 ; i < 500 ; i++ )
       {
           tempCubeset.GetComponent<CubeSet>().AddCube( new Vector3(0.5f, -11.5f, i+1.5f) );
       }
 
 
       //repeat (this forces a draw call per cube?)
       tempCubeset = ( GameObject ) Instantiate( cubeSetPrefab , new Vector3( 2.5f , -11.5f , 0.5f ) , Quaternion.Euler( 0 , 0 , 0 ) );
       tempCubeset.transform.GetChild( 0 ).gameObject.renderer.material = new Material( Shader.Find( "Transparent/Diffuse" ) );
 
       for ( int i = 0 ; i < 500 ; i++ )
       {
           tempCubeset.GetComponent<CubeSet>().AddCube( new Vector3( 2.5f , -11.5f , i + 1.5f ) );
       }

Any ideas what is causing this?

For context: I want to dynamically create "layers" of these cubeSets and be able to have several cubeSets each containing several cube children of their own. I am looking for a way to change the material/color of all cubes inside of a given cubeSet at runtime without having to step through every child individually. I am trying to use renderer.sharedMaterial to do this which seems to work great with one cubeSet, but not two?