How do I play the slurs with in the larger slur? Can you play this two ways? One big slur or individual slurs?
The outer/larger slur is a phrase marking, letting you know that the entire passage constitutes a single musical idea. The inner slurs are similar, but indicating smaller units. One could think of the inner slurs as indicating words, and the outer slur as denoting a sentence.
Part of the reason there are two sets is that there are some places in the phrase which demand re-articulation (tonguing), which would otherwise break up a true legato. For example, the passage starts with two Es, so the second one needs to be articulated. The accented A toward the end of the passage also requires articulation. The outer slur, then, is a reminder to play legato overall.
There are also implications for breathing. The outer slur suggests the entire passage should be played in one breath. However, if one breath isn't possible, then the inner slurs provide a guide to where a breath could happen (between them, not during, of course).
The way I would play this passage is that I would make the small/inner slurs true legato, and I would use a legato/gentle tonguing technique for notes within the larger slur but not themselves connected by smaller ones. I would play the entire passage in a single breath.
So, for example, I would tongue the initial note and the gently re-articulate the second, slur to the third, then gently re-articulate the fourth and fifth, slur the sixth and seventh, and gently re-articulate the eighth. If necessary, I would sneak a breath in before that note as well.
Whilst they all look like slurs, they're not. Some are ties, which means they're making one long note out of two written. Bar 4, the E notes are as such.
But, there's one phrase mark over bars 1 to 4, which is more likely what you're questioning. Imagine speaking, and splitting your sentence into four separate little bits - mini-phrases. That's what's happening here. There's a sort of short break after each mini-phrase, but the whole four bars need articulating as one longer sentence.