So you and your partner have a son.
Your bil and his partner have a son.
Bil is in prison and his partner cannot look after their son, so her mother has taken him in and he lives with her now.
You DP and BIL have family who spoil BILs son.
They don't do the same for yours.
They also call your son names.
You feel that your son is being pushed out in favour of your nephew, and insulted at the same time.
Is that right?
It's always difficult when families treat one child differently to the other. But I absolutely would not stand for the name calling.
I wouldn't get drawn into an argument about the presents, but I would call each and every one of them to task about the comments calling him stupid or suggesting he has ADHD or whatever.
That is is the issue I would really want to deal with, although if you do want to raise the imbalance in the way they are treated I wouldn't bring the value of the presents into it, just say that they don't seem as interested in your DH and didn't even bother to bring him a card to his birthday party. Leave the presents out of it.