From what you are saying, I assume that your BIL has sperm, but not in his ejaculate. If IVF is recommended, they will surgically, (minor incision) remove sperm from his testicles. This sperm is not able to "swim" to fertilize an egg by itself, even through insemination. Thus IVF/ICSI, a procedure where a single sperm is manually injected into an egg, forcing fertilization.
Your sister's good reproductive health is a great bonus, as this procedure has a very high success rate, much higher than insemination. I have an almost 4 year old beautiful ds thanks to this amazing procedure. There was no other way to get sperm from my ds, and it was worth all the pain and trouble of going through it. I too was considered in great health, one less obstacle to deal with.
I am confused that you mentioned the possibility of AI, but if the doctor's are recommending IVF at this time, maybe insemination isn't possible. I have been through a long ordeal to get to where we are today, and from my experience, I would recommend going straight to IVF, unless your BIL suddenly shows a great sperm count. It could save your sister months of heartbreak trying otherwise.