You can modify the code so that within the iterate macro, you divide the incoming parameters by 10. The following sample code may help you -- no guarantees expressed or implied.
I've changed the upper bounds of the do loop to 20 instead of 2 as well.
%macro iterate(i,j);
data _null_;
temp_i= &i/10;
temp_j= &j/10;
call symput ("new_i",temp_i);
call symput ("new_j", temp_j);
run;
%put "&new_i &new_j";
/*
proc nlmixed data=dataset1;
parms beta1=&new_i,
beta2=&new_j,
s2e=1,
s2beta=1;
model Y ~ normal(beta1+beta2+betavar,s2e);
random betavar ~ normal(0,s2beta) subject=sid;
run;
*/
%mend iterate;
%macro looped;
%do i=1 %to 20 %by 1;
%do j=1 %to 20 %by 1;
%iterate(&i,&j);
%end;
%end;
%mend looped;
%looped;