As near as I can tell, the conversation went something like this:
Singing teacher: Okay, hold up one finger for every member of your family... Nathan, you only have six.
Lil'Nathan: No, I have seven.
Friend: (nudging him) Don't you mean 6 1/2?
LN: Oh, yeah, 6 1/2.
ST: Oh. Is your mom pregnant?
Teacher from the back (to singing teacher): Umm... is that public knowledge?
ST: I don't think so.