I don't believe it is a birth (adoptive parents aren't un-natural!) parent. I understand that it is birth fathers sister.
Very unusual situation. Without knowing all parties it's impossible to know whats best for the child. But generally I would have thought the time to try all possible options with respect to extended birth family is prior to placing with an adoptive family.
Its not about whether the child will "forget" but as soontobesix says how it will affect their attachment. Imagine you 20 month old is removed from you, thier home, their room, pets, siblings, friends, grandparents etc and given to a strange family in a strange house in a strange room etc.
Most of us adoptive parents have been in exactly in this position and its really not easy on a child. And they don't "forget". DS was placed with me at 1yr and at 9 he is considered to have an "insecure" attachment. He is well attached to me but is often anxious about it being removed from him.
How attachment is affected is partly dependent on the childs perspnality and partly on how good the new guardians deal with it (very simplistically).
Very sad and not an ideal situation for anyone.