You're not missing anything. Sex between blood-related
uncles and nieces (or blood-related aunts and nephews)
is definitely incest, but, according to Fakku (apparently),
only sex within the immediate family counts as incest.

That makes things unnecessarily confusing, since inseki
applies only to sex involving in-laws, adoptees, step-relatives,
or any family members who share no blood connection.

Why incorrectly tag a chapter as "inseki" when the "incest"
tag is likely to draw more readers, since incest is perceived
as being "hotter" (more transgressive) than mere inseki?