Have you talked to your problem neighbor? Currently there is a program offered by the district to help pay for newer more effcient wood stoves. If this person would be willing to talk to you the information may be readily accepted by the neighbor. Here is a link to the Wood Stove Exchange program offered: http://www.rdn.bc.ca/cms.asp?wpID=2435
As far as bylaws being broken I do not think there is anything that you can do. As an alternative though the seniors complex as well as local residents could offer a little money to help offset the costs for the owner to swap out the stove if he cannot afford to do the swap all by himself. I know this does not sound fair but it is an option that could benefit everyone.