An indoor secondary suite inside the existing basement sidesteps the yard-coverage question entirely, but an older Nutana foundation built before 1920 often sits lower than current code allows for a legal ceiling, and raising it usually costs more than the setback problem a garden suite would raise instead. Either way, the City of Saskatoon still requires the same building permit before the space is legal.
Which route makes more sense depends on the specific lot and house, not a rule that applies to every Nutana address the same way. A detached garden suite avoids the basement's structural limits but has to fit within the yard's setbacks, while an indoor suite avoids the yard question but has to meet ceiling height and egress inside an old foundation.
Joel Dyck can tell you which route actually fits a specific Nutana property before you pay for drawings. Get your hand-reviewed valuation from Joel Dyck.