my advice...stop watching horror shows.
although most surgeons still do grs in two procedures, dr bowers gets it done in one, and done nicely i might add. that ends the surgery part of the process of transition. dilating, for most of us, is just something we have to do if we aren't sexually active. it's not horrible, it's annoying and takes time, but once we're completely healed...each is different in her needs.
maybe in the dark ages something you describe may have been the case, but...if that were to happen today let me assure you the doctor would not only be defrocked, he'd most likely end up in jail.
in fact, i don't even think that grs would have been performed on a child under the age of eight in the nineties, assuming the child had normal genitalia for his biological gender. i seriously doubt you could find a surgeon to do that today. perhaps there'd been some genital deformity they tried to correct, or the child was ambiguous...so they made a guess and tried to make it look right. but these aren't the cases i think we're talking about here.
i don't know the conditions your nephew was circumcised under, or the qualifications your sister has to do such a thing but circumcision has been done throughout the ages with little harm done. some in the medical profession recommend the procedure not based on any religious values at all, just for health reasons. that's a procedure i think best left to parents, based on their values and their expectations. your sister may or may not wish to take your wishes into account when making that decision, but only the child's parents have standing to make the decision.
i'm with nichole on the practical concern here. we're a long, long way from doing grs on children who display a gender dysphoria.