Sorry to hear your friend's nephew seems so unhappy.
When I read your post, my first thought was, is he a Highly Sensitive Child? Check out this .
The trait of acute sensitivity is apparently being increasingly recognised in psychology/psychiatry, and about 15-20% of the human (and horse, mice, dog, etc) population are believed to have it ... including me!
It's essentially, as the name suggests, about having a body and mind that are way more sensitive than average to external (and internal) stimuli: light, sound, colour, texture, smells, people, the things others (and the voice in your own head) say. Common characteristics include weighing people up before diving in socially, analysing and observing, introspection, pronounced empathy and creativity and perceptiveness, higher-than-average intelligence, among others. And all these traits can be, and often are, misread and labelled by others as shyness, social awkwardness, fussiness, difficult behaviour, etc.
When hyper-sensitivity is recognised in an individual, those around them can begin to better understand why they behave as they do, and enjoy the many pluses that come with being this kind of person. If sensitivity is misunderstood, and reacted to brusquely, you can see how some kind of withdrawn, unhappy behaviour may result.
I'd suggest looking into whether or not your friend's nephew seems a Highly Sensitive sort.
Hope this helps.
EBAB