Your letter states your nephew’s name and you completed form I-134 for his B-2 visa application, which is approved. You state that from recent conversation with him and his family, you have found that he intends to stay in the US indefinitely. This new fact is different from his original plan that he would return to China promptly.
The US consulate will enter the info into their computer. When your nephew arrives in a US airport and pass the US Immigration Office, he will be denied to enter the US. In other words, his B-2 visa is canceled and he will need to take an airplane to return to China immediately. I do not think the immigration officer will tell your nephew that you wrote letter. Therefore, he and his family will never know why his B-2 visa is canceled.