Hi Ultra.
It’s nice of you as an Uncle to be concerned for your nephew. Here’s my 2 cents worth.
There were a couple of kids in grade school, one kid (Kid-A) was handsome, always had the girls flocking to him, he was about 2.5 inches erect and very thin girthwise. Another kid (Kid-B) was below average in looks, was picked on a little bit (both in school and in the shower after gym class), and his unit looked like a 2nd belly button, less than 1 inch flaccid.
Kid-A, from outward appearance, maintained dates through High School, was confident, definately no mental issues, he could have felt bothered about his size, but didn’t show it or say it.
Kid-B, from outward appearance, Had some issues, but had what appeared to be a normal high school life.
I have bumped into both of them as adults, and they were both married and have kids, and seemed to have a normal life.
I dont have a clever ending or saying to this story, except that maybe it’s important to work on whats between your ears first, some how work on his confidence as a person.
PE is cool, but I dont think there’s 100% chance of growth for everyone. Teenagers generally have a short attention span, and they might not have the focus to PE consistently, could possibly end up being a negative. Plus throw in if he mentions it to some friends, then they in turn tell their Parents, and the info spreads around, well, it’s just not an accepted thing to do, yet, anyway.
Also, if there is a Mom involved, I think she would have to be in the informational loop.
I wish him best luck.