I was in the same situation as Helen--our son was our nephew when he was in foster care.
Our ICPC took forever--the ffamily was aware of us, we gave an album of pictures a few months after he was in care, and we had requested the ICPC. When the placement was imminent, their attitude was awful-- I was told by fmom "he's a member of our family, we consider him a member of our family" and then she proceeded to badmouth our entire family and even lil guy's sister who was barely 18 yrs old and was in foster care also. Ironically, their agency excused their behavior by saying they were not aware of us and our interest in the child--interesting that she knew enough about the family to run down everybody, but was "not aware" there was a pending ICPC.
It was awful, and worst of all--the horrible stress on lil guy (he was 6 1/2). I could go on and on, and rereading the above, I guess I did!
We would have been so open to communicating with them-but they decided early on--no communication. Unfortunately that was their call-and they tried to use the lack of contact against us in court. If we'd had a chance to get to know them and develop a relationship of mutual concern for the child and mutual respect, we might have been OK with the ffamily adopting him. But they literally terrified us with their attitude--we could not consider leaving him with them.
So, I have gone on too much as usual-please forgive me.
OP--please keep your hearts open to the child's bfamily members. They love this child, they want to provide a home and love just as you do, and also share the family history and heritage, the family customs and traditions. These relatives may also be able to share the how and why of the bparents not being there for the child in a way that aparents outside the family may not be able to do.
There is a chance you can come to an understanding of how well the child is doing with you and that you are a good place for the child to stay. I think the key is to acknowledge their love and concern for their young relative, and go on from their as your heart (and common sense!) guide.
Will be thinking good thoughts your way, and I hope everyone involved keeps the child foremost in their hearts and minds.