Nels is really good at playing guitar. I want to start from that basic premise.
There’s a basic structure to most of his studio solos, though (this does not always apply live, as anyone who has seen the Nels Cline iteration of Wilco live can attest). He starts with an intricate countermelody, for lack of a better term, built on the chord progression of the underlying song. It builds slowly from there, until the entire thing explodes into either the melody or a new, elongated harmony built octaves above the band. It goes and goes and goes until it runs out of room, and it collapses from there.
This is one of those solos, and a completely fucking awesome one at that. The band plays along, chugging beneath Cline’s rocket blasts, just trying to keep the damn car on the road. It works, in the same way that so many Nels songs on A Ghost Is Born and the newest album work. It works because Nels works with Tweedy as well as any musician Wilco has ever had.