Enabling and disabling Nanite on individual static meshes on runtime to allow for highlight/outline

yes.
“There should be a bDisallowNanite flag (which can be set a runtime) on StaticMeshComponent for the renderer to fallback to the nanite proxy mesh if r.Nanite.ProxyRenderMode is set to 0 which should be the default.”

Also i’ve made a postprocess that uses custom stencil to draw outlines and it works. so could be an issue with your meshes, not nanite.

also there’s r.nanite cvar for global toggling