Be cautious with what you find on Familysearch as there are a lot of mistakes. It is a good place to start looking but be sure to back up the results with real records. I don't believe Warren and Vermillion were ever one county. They do adjoin and people moved back and forth.
I found your grandpa in Warren Co in 1860 and possibly that is where they got the idea he was born there. However, the census says Iowa!
1860 STATE or TERRITORY: IN COUNTY: Warren DIVISION: Mound Township REEL NO: 653-305 PAGE NO: 213
REFERENCE: Enumerated on 9 July 1860 by E. F. Lucas
Nichols William 25 M . Farm labor 900 500 O . . . . .
Nichols Sarah J. 22 F . . . . Ia . . . . .
Nichols William 10 M . . . . Ia . X . . .
Nichols Jacob M. 8 M . . . . Ia . X . . .
Nichols Charles W. 6 M . . . . Ia . . . . .
Nichols George 4 M . . . . Ia . . . . .
Nichols John C. 10/12 M . . . . Ia . . . . .
1870 United States Federal Census > Indiana > Warren > Mound
enum July 27, 1870
William Nichols, 45, farm laborer, b Ohio
Sarah, 39, b In
Jacob M, 19, laborer, b In
Charles W, 16
George W, 13
John C, 10
David G, 6
Joseph D, 7/12
I found a lot of Wm Nichols married in Vermillion Co but none to a Sarah. I did not find a marriage for any of the Nichols in Fountain Co though.
Vermillion Co was formed in 1824 and Warren was formed in 1827
I hope this helps a little. I am from Danville, Illinois and many of my relatives lived in Warren Co, Parke,Vermillion and Fountain Co, Indiana.
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