You are doing really well already. You have picked it up early, my son, now 3.5years, was dismissed by everyone and I only got him diagnosed 5 months ago. I wish I'd pressed for it like you have done.
That a nursery have accepted him and area able to work with him is fantastic. My preferred nursery refused him.
My son was the same, did not understand anything. In fact only responded to his name at around your sons age. You are very wise to pick this up and there is a huge amount you and the nursery can do to get him to understand. Don't worry about him saying if he's hungry or thirst, or complicated instructions. You can get that understanding. Just go back completely with him, go less than you think the level he is at, and start really, really, really simply! In fact, start preverbally.
For example, does he say any words at all? Does he say any say any sounds?
I've had two SLTs and both of them hadn't a clue really where to start.
Any form of communication is a good start, which can be as simply as any game that your son likes, like 'tickle', or peekaboo. Don't expect or pressure to speak at all at this stage. Just get on his level and build up, slowly, his pre verbal communication. If he likes peekaboo - start playing it, and then wait to see if he gestures to get you to do it again. WAIT for that signal of communication from him, even if it just looking at you, touching you, raising his hand, whatever. This is communication. Keep doing this in all sorts of ways.
Find his favourite foods. If he is saying any syllables, like 'baa' or 'maa'. Have his favourite food, break it up into small pieces, sit in front of him and hold it just out of his reach. If it is biscuit, hold it out and WAIT again, to see if he responds at all, with a look, a gesture, anything. Give him the biscuit as soon as he gestures. If he points, that is fantastic! If not, don't worry. As you are giving him the biscuit, say 'Bi, Bi, Bi'. Do this LOTS. Gradually, you can build him up to gesturing you to ask, saying something like that he wants, even if it is 'Bi'. It may take weeks, months. But it will happen. If he doesn't do anything, still give him the biscuit! Just always wait a give a little time, and then do what you'd like him to do while giving him it so he gets a strong association (e.g. Give him biscuit while saying Bi)
Then after he can put gestures, and then sounds, and then words, to what really motivates him, you can build up to him understanding simple instructions, such as 'give me'. You do this by saying give me and then taking your boys hand and carrying out the action. If he doens't like it, only do it once for very short times until he gets used to it and give him a reward.
The trouble with your speech and language showing him cards, is that he isn't motivated enough. What's in it for him by just saying names?
My son can now ask for a range of things, understand simple instructions, put two words together. He's 3.5 years so still way behind, but before I started working with him it was zero.