Alright, I've been one of those famous net-lurkers around these forums for a long time. But, I've never registered or posted until now, and it's because of this thread. Mainly for two reasons: one, the back-and-forth here is actually intelligent and respectful (and that's rare on the internet) and two, because I like hot-button topics to weigh in on (pardon my prepositional ending). Now, preamble out of the way for my first post at EM, on to the OP...
To me, it's amazing how fast the actual issue underscoring a question can get misconstrued. That is, this really isn't a simple question of "should the child be told that some boys and girls like other boys or girls?" The simple solution to that would be to ASK the child, "well do you think you like boys or girls?" In a simple, lighthearted way. But wait, what are most kids that age going to say, "I like boys and girls!" and have no idea what you just set them up to admit to. Point is, kids are smart, but they think simply (we should all be so blessed). Sexuality will barely register in terms of it's umbrella-like nature and the considerations therein. This is why homosexuality is such a powder keg in terms of what is "taught." You simply cannot teach sexual orientation.
So, why the issue here? It's because this is a discussion about familial political correctness, not lifestyle. I speak for what I have observed in the U.S., as I am not a globetrotter, by the way. That said, we have by and large become a society (I don't say "nation," because our nation is and will always be great) of people that are obsessed with catering to people's feelings and expectations. If we don't teach our kids to be sensitive to everyone else at the expense of self, we are wrong. We are horrible parents. We are not keeping up with modern societal evolution. Now, before this becomes a rant in the wrong direction, we'll get it back to the point. If it is expected that being gay is acceptable, it should be equally as acceptable for someone to NOT find it acceptable. Does that mean someone who doesn't approve of gayness should be militant, abusive, or condescending? Absolutely not. But it DOES mean that if they want to teach their child(ren) their opinions on the homosexual persuasion, they are entitled to do so. That is what parents do. End of story. They shape children according to their values and beliefs until that child can make decisions for him/herself. NO child is capable of making long term, life-appropriate (and I use "appropriate" with great hesitance) decisions at the age of 7, 10, 14 or even 18 in some cases.
The key issue here is not should it be brought up by the parents. Several posters have said that if the child brings it up then discuss it. I agree with this. But, if you are going to discuss it, decide from which point of view you are coming from. Biological? Religious? It doesn't matter as long as there IS a standpoint.
Sadly, the most pointed area of contention within a discussion like this would be trying to eliminate bias if you don't want it in this discussion. For example - a deeply (Christian) religious family might have the discussion (or not, for the reason of purposeful omission) and point out that being gay or "liking boys/girls" (as the situation dictates) is wrong. Fine. If that is their home and their child - their business. (As an aside, there is a world of difference between not condoning homosexuality and homophobia.) There could easily be a similar family that has the Family Stone approach of homosexuality is just a tendency, such as handedness (to quote the movie) and there is nothing wrong with it. Also their business.
My advice, as a heterosexual male, married, uncle, brother, whatever - is to say to your sister-in-law (speaking to the OP, here)figure out HOW you are going to discuss it if/and when you do. The WORST thing that can happen is that you discuss the concepts of sexual orientation to a child, saying homosexuality is okay if it is based in love, and then alienating them because it isn't what you believe. That is the absolute bottom line. Teach them what you want, but be clear about how YOU feel. Don't pretty it up, don't lie through your teeth for the sake of having a "politically correct" conversation in your own home.
/deep breath.
-R.