Reading between the lines I think this is what happened and what the police suspect happened.
It is not a murder enquiry even though AG has been missing for a very long time with no trace that we know of.
The two men who were arrested a while back and investigated - and yes they were released without charge - were arrested for a reason. There was something to possibly link them to AG after all this time and that is most likely some connection somehow to CSAM that the police think could include AG. Obviously as AG would now be an adult that would be historical material and difficult to prove that this was AG although to make arrests they would have had to be fairly sure that there was a high probability.
AG was a teenager and his mum and dad just won't have known him as well as they thought they did because he was no longer the little boy who was transparent to them. He had secrets. It is perfectly obvious he was secretive because he went off to London without telling them. They did not suspect anything at all. He kept that secret really well. His dad says AG told him he had lost his mobile, well teenagers lie. It is very easy to conceal the sorts of small mobiles we had back then. SIM cards were easy to come by and pay as you go could be arranged by someone else. Just because his dad says AG did not have a phone does not mean he did not. In fact, that is pretty meaningless.
I get that it is very hard for AG's dad, who seems a fantastic bloke, to get that he didn't know what his beloved son was up to but it is very common.
AG was not that happy at school, there are rumours he had some sort of "black book" that he wrote names of people he didn't like in. That sounds like a lonely boy who doesn't really fit with his peers. He didn't have close friends. He was intellectually smart, a geek but not street smart. He would have stuck out a bit even at a nice school. Sure, his sister was involved in anti bullying but AG was a teenage boy and it's not surprising he didn't confide in her about his personal life. He might have been struggling with or realising his sexuality, there might be a good reason why his dad mentioned that if AG is gay, the family is accepting of that. Why say that? There are many ways in which he was quite vulnerable and probably an easy target.
AG's story is very sad and if he is out there, I hope that he is safe and well and able to get support and help.