Sounds like the issue is with your sister more than your nephew.
He probably was told by his mother that he could stay there rent free, but you need to remind him that even if his mother said he could live in her 5/8 for free, he still agreed to pay you $300 per month. His mother may have even told him specifically that he didn't need to pay you rent. Find out what is happening...
$300/month for rent is such a small amount of money for a double-income couple. They should feel bad for taking advantage of their aunt. Before seeking legal action, maybe you should give him a call to "remind him" that he agreed to pay you rent for your 3/8, and then, you can send him or drop off a nice note to tell him the address where he can send his rent check. Give him a chance to pay the rent.
I am not trying to give you legal advice. I have a big family, too. Since you like your nephew, I think you may be able to preserve your relationship better than if you start off with sending him an eviction notice.
PS- You could probably call the billboard company and ask who the checks are being sent to.