This is a tough question to answer. There may be much more to this situation than meets the eye. I’m concerned because the boy is only doing first grade level work when he is 9 years old. Either the home schooling isn’t working or the child has more problems than gluten intolerance. It’s just possible that you don’t have the whole picture.
Have you tried sitting down with his parents and talking with them, in as loving a way as possible, about what they think goes on with their son? What you see as unloving may be frustration, guilt, and anger that their son isn’t what they thought he would be and/or they have been unable to help him. They may need help, not criticism, for being at the end of their rope. If that’s the case, you may be able to provide the support they need to find resources to help him.
If, on the other hand, they just don’t like their own son, it’s another matter. When that happens, there is often a secret. Again, all you can do is sit down with the parents and ask if there is a way you can help. Sometimes, it’s very helpful if a loving relative takes a kid out of a situation for school breaks and part of the summer. It gives everyone in the family a chance to regroup. It gives the child an alternative experience to hold onto. It can give you the opportunity to have fun with a youngster you obviously like.
As you point out, any intervention will need to be done with the utmost tact. The parents are already defensive so pushing too hard will only result in you being ejected from the situation.
I wish you well.