Nietzsche's relationship with nihilism is complex, I agree. But I don't think he would have said to 'embrace' nihilism. Nihilism for Nietzsche was more 'a stage', or what results from the 'death of god'. Its the unavoidable result. Its a place, one had to pass through, after one breaks the chains of christian morality. It wasn't the goal.But Nietzsche's thoughts on nihilism can't really be summed up in a sentence like that. He spoke positively of nihilism, as well. Particularly what he called "active" nihilism. (I.e. embracing nihilism and responding productively to it).
From: On a Geneology of Morals
"This man of the future, who will release us from that earlier ideal just as much as from what had to grow from it, from the great loathing, from the will to nothingness, from nihilism—that stroke of noon and of the great decision which makes the will free once again, who gives back to the earth its purpose and to the human being his hope, this anti-Christ and anti-nihilist, this conqueror of God and of nothingness—at some point he must come . . ."