I have used points on behalf of family members many times. "Go anywhere you want in the world" is a nice graduation present for a niece or nephew. For my younger son and his wife, it was "both of you, in first class." (It became business class when they put their trip off a few years and the number of tickets went from two to three, but they enjoyed Japan.)
The one thing I caution them about is that airlines, understandably, are concerned that people might sell award tickets and tell the buyer "just say you're my nephew." As a result, airline personnel may ask people on award tickets that came from someone else's miles questions about that person. As his son, you'd know the answers to questions that a stranger wouldn't be able to answer, so this shouldn't create a problem. Just don't be surprised if it happens.