This command is only to be used on an ABR. When this command is used on the ABR, it generates the default route in the NSSA area with the P-bit cleared so that the type 7 LSA is not translated by other ABRs, hence R5 not translating the default route into a type 5.
If you do a "show ip ospf da nssa-external 0.0.0.0", the options field should say "No Type 7/5 translation".
For more information on the usage of the P-bit, please refer to RFC3101.
Of course Mr Ritter is 100% correct, but just to add a little something....
Not only will you see the No Type 7/5 translation, but you will also see a 0.0.0.0 forwarding address, which violates another requirement that type 7 LSAs need a non-zero forwarding address if they are to be translated into a type 5 LSA.
Moreover, that non-zero address must be internal to the OSPF domain, otherwise OSPF will not allow an external network with an external forwarding address to be placed in the routing tables of routers that sit behind the ABR. It does this to prevent routing loops.
I am sharing this with you because your problem reminded me of an issue I had like this that kicked my ass for a few hours before I figured it out using a Ciscopress book called "Troubleshooting IP Routing Prtocols." :-)
Just some clarification. The "area nssa deafult-information originate" command can also be used on a non-ABR router but requires the router to already have a default route installed in the RIB from a source other than ospf.
Also, the type 7 LSA will not be translated to a type 5 LSA by the ABR even if the P-bit unless the fowarding address is also set.
See the following document for some additional rules and restrictions related to NSSA areas:
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