Train mom here! My son was all about trains from 1.5 - 5 years old.
You can get a wooden train starter set from Thomas, Chuggington, Brio, Target, BUT DO NOT GET AN IKEA SET if you have any inkling that your child may turn into an enthusiast (we have many engineers in the family, so I knew to expect something like this). Thomas, Chuggington, Brio, Target, and the Toys R Us brand are all compatible, but the IKEA set is only semi-compatible. This leads to a lot of frustration trying to fit the pieces together!
The great thing about getting a compatible set is that there is an incredible variety of add-on pieces, at every price point. If it exists in the real train world, there is a wooden train version. I particularly like the Whittle Shortline Railroad Wooden Toy Trains, which are wooden-train versions of real trains your child can see while out and about.
https://woodentrain.com
We also found wooden-train versions of the trains the characters from Thomas were based on, the Mallard and The Flying Scotsman.
The wooden train sets are super sturdy and quite suitable for young children. They have magnetic connectors and no small parts. If your great-nephew goes on to become a train enthusiast, you are going to have a lot of fun buying pieces for his set over the years!
Q