Thank you all for the wonderful responses.
I guess I should have been clearer. I'm fairly certain my niece (9) does believe that all the characters are real, however, I can't exactly ask her.
My nephew (12) isn't going to be forced to meet the characters, per say, but because we'll have the memory maker, I really feel like it's a missed opportunity if he isn't in the pictures (especially because his parents won't be there).
When I say "all the different characters", I simply mean the different kinds of characters. My mom and I always hopped in a line if we saw a character greet, but never scheduled them. It was sort of "in the right place at the right time" experience. We'd gauge the line, and if it wasn't too long, we'd jump in. I assume this is what we'll be doing, with a few must-meet characters, such as magician Mickey, Anna & Elsa, etc.
Of the two, my niece is actually the more adventurous one. There is legitimately not a ride she doesn't want to go on, even forcing me to go on to Tower of Terror for my first time. So there isn't actually anything he wants to do that she doesn't. I definitely don't want to split us up too much because whatever ride he might go one, she'll want to too. He's fairly understanding, as I don't think he's spoiled Santa for his sister.
It's going to be their first trip to Disney, and it will be myself (23) and my mother / their grandmother (59), as we'll both be AP holders.
I really just want to make meeting the characters as fun as possible for him, because I remember grinning it and bearing it for my mother as a child. I've been going since I was 8. In retrospect, I've gotten some of the best memories and photos from them.
I do think he'll enjoy character meets, just substantially less so, so I was wondering if you guys had any tricks to curb his apprehensiveness.