Remember that the payouts all are projections, based on prior filings and to be reconciled to Actuals when tax filing for the year.

Let's break this down:

"Taxpayer has 2 children from 2 different mothers." <== meaningless

"in 2020 Taxpayer filed head of household with Child (A) and received $1400 for Child (A) and $1400 for himself." <== for self and one minor child. Not "child A." A Child, projecting that 2021 would still include a minor child.

"For 2021 Child (A) will be claimed my Mother (1) and not on Taxpayer's return." <== meaningless

"Taxpayer will Claim Child (B) born in 2021 on his return and qualifies for $1400 stimulus for child born in 2021." <== no; new child isn't anywhere in the code.

"Child (B) replaces Child (A) but $1400 needs to be claimed for CHild (B)" <== The Only Thing that matters

2021 actuals = Self and one qualifying minor child. Already got money for self and one minor child. There is nothing more to try to get.