So basically, if I've got this correctly, your sister's daughter was molested by her father's brother and so she told her father, at which time her father's brother committed suicide. (The problem is, your particular choice of words defied the laws of linguistics by saying half as much with twice as many words.)
Yeah, the guilt's typical with molestation; what's bad is, most child molestors don't even know what they're doing is wrong, just like how rapists search for just one smile from their victim so they can be vindicated.
Oh, interestingly, the taboo on incest is universal.