1. Extras matter. But quality of extras matter more than quantity. Demonstrating leadership roles in 2-3 extras versus just membership in 6-7 is superior. Extras will give you a bump, but applications are looked at holistically. Some admissions people will tell you that the quality of the HS's reputation doesn't factor in. In fact, a former RU admissions officer used to post here and said it didn't at RU. Anecdotally, I find that hard to believe as better rated HS universally show "better" college placements. At this stage, nothing your nephew is going to do about his HS's reputation. But he should absolutely seek out a leadership position in 1-2 groups he has been active with.
Also, extras outside of the high school are hidden gems of application bonus points. Volunteer work, charity work, part time job, mentor programs. future leaders programs, etc.
It's all about demonstrating a well rounded individual. The only time it pays to be a specialist in this situation is if you are a prodigy--a recruited athlete, a concert level musician, an established screen or stage actor, etc. Otherwise, it pays to be a renaissance man.