Bring 2 of any toy you can so when he wants it, give him the toy, just not from your son. He just wants it b/c your son has it but this solves the problem without you having to discipline him ALL the time.
Set 2 toys aside as special, your son's wubby kind of thing. These two toys are non negotiable and are always your son's. Encourage your nephew's mom to do the same. That way when your son has had enough of the grabbing and mauling he knows he's got a fall back. My daughter had a blanket and a bear that other kids weren't allowed to play with. If a kid was out of control she would go pick them up b/c she knew I'd keep the kid away. It was her signal for I've had enough w/out being able to verbalize it. Each of my daughters had their own bear or baby that is theirs. Everything else is shared but not that special toy.
Also my mom had a "no apologies" approach to parenting. If you were in her house you did it by her rules. Also if it affected her kids even in other's homes. She'd give a stern verbal warning along with "the eye" and stare the kid down. If they didn't listen the kid was immediately brought to the mom to be dealt with. Half the mom's didn't do anything(that was the problem to start with) but the kid learned not to mess around in front of my mom. The trick is you HAVE to mean business and back it up everytime no matter how difficult. It will be worth it in the long run but it will be tiresome for you. Not one of my sisters or myself have ever been bullied in front of my mom, ever. Neither have my daughters. It's a nice feeling.
He's just three, it's still your job to protect him.