This works for me on Darwin and Linux, using npm 6.14.2, 6.14.8, 7.0.7, and v7.0.10, with node 14.2.0, 14.15.0, and 15.2.0.

$ mkdir -p x/y/z

$ echo 'const child = require("child_process"); child.execSync("npx --no-install rimraf x", {stdio:"pipe"});' | node -

$ tree x
"x": No such file or directory (os error 2)

When rimraf isn't installed locally or in the npx cache, the --no-install causes it to fail with the cancelled error, but that's expected.

$ echo 'const child = require("child_process"); child.execSync(`npx --no-install rimraf x`, {stdio:"pipe"});' | node -
node:child_process:675
    throw err;
    ^

Error: Command failed: npx --no-install rimraf x
npm ERR! canceled

I'm not sure why you'd be getting an empty error output though. Does it create a debug log file in ~/.npm somewhere? Can you run other commands (other than npx) in this manner? Does it work if you remove the --no-install argument, or if you first run it without the subshell? Does it work if you delete ~/.npm/_npx?

Good testing @isaacs, however as mentioned in the original description this doesn’t repro on Node 14 or newer. I’ve not tested 13. It does happen under Node 12 - at least on my machine. And while I’d love to be running 14 and getting access to all the niceness it brings, several projects aren’t paying for that upgrade yet. 

As to your questions, again running under Ubuntu and Node 12 with NPM 7.

1. I'm not sure why you'd be getting an empty error output though.
   • I'm unsure what you mean by an "empty error output" unless you mean that the streams were empty?
2. Does it create a debug log file in ~/.npm somewhere?
   • A log file is indeed created in ~/.npm/_logs with the attached content: 2020-11-12T18_57_44_498Z-debug.log
3. Can you run other commands (other than npx) in this manner?
   • My memory indicates that the npm command behaved similarly, but I'm currently not repro'ing with npm. Common shell commands such as ls and find don't error out.
4. Does it work if you remove the --no-install argument, or if you first run it without the subshell?
   • Under npm v6 and v7 there are different behaviors when a package isn't in the package.json and npx is called without the --no-install flag. Using the flag makes both versions behave similarly.
   • I'm unsure what you mean by "if you first run it without the subshell" as I'm not aware of a subshell being used in the example I gave.
5. Does it work if you delete ~/.npm/_npx?
   • Behavior doesn't change.

As an experiment I upgraded my node to 14:

$ snap refresh --channel=14/stable node
node (14/stable) 14.14.0 from OpenJS Foundation (iojs✓) refreshed
$ node -v
v14.14.0
$ npm -v
7.0.7

And re-ran the test. So the following combination is failing the test command on my machine:
Ubuntu 20.04, node 14.14.0, npm 7.0.7.

$ mkdir -p x/y/z
$ ls -ld x
drwxrwxr-x 3 ricky ricky 4096 Nov 12 11:29 x
$ echo 'const child = require("child_process"); child.execSync("npx --no-install rimraf x", {stdio:"pipe"});' | node -
child_process.js:655
    throw err;
    ^

Error: Command failed: npx --no-install rimraf x
    at checkExecSyncError (child_process.js:616:11)
    at Object.execSync (child_process.js:652:15)
    at [stdin]:1:47
    at Script.runInThisContext (vm.js:132:18)
    at Object.runInThisContext (vm.js:309:38)
    at internal/process/execution.js:77:19
    at [stdin]-wrapper:6:22
    at evalScript (internal/process/execution.js:76:60)
    at internal/main/eval_stdin.js:29:5
    at Socket.<anonymous> (internal/process/execution.js:198:5) {
  status: 243,
  signal: null,
  output: [ null, Buffer(0) [Uint8Array] [], Buffer(0) [Uint8Array] [] ],
  pid: 3154622,
  stdout: Buffer(0) [Uint8Array] [],
  stderr: Buffer(0) [Uint8Array] []
}
$ ls -ld x
ls: cannot access 'x': No such file or directory

With the following log:
2020-11-12T19_28_03_514Z-debug.log

More fun that might, or might not, help locate the origin of this issue: today I was trying to do some bash scripting around some npm commands and got a very similar interesting result:

$ npm run build; echo $?
# <SNIP, runs fine>
0
$ npm run build 2> test; echo $?; cat test
243

There was no content in the test file.

The relevant line from package.json is "build": "react-scripts build" - so pretty standard.

This repros in both of the following configurations on Ubuntu 20.04.2 LTS, with node and npm installed via the official snap package:

• Node v12.19.0, NPM 6.14.8
• Node v14.15.4, NPM 6.14.10

Kinda looks like it really doesn't like being redirected away from a tty.

@kc15155 I wasn't able to repro this on Node v10.24.0 or v12.21.0 w/ npm v6.14.11 or v7.5.6 on Darwin - potentially try removing the --no-install (which is deprecated in v7 either way - it falls back to --no which is the equivelant of --yes=false - ref. https://docs.npmjs.com/cli/v7/commands/npm-exec#description & https://docs.npmjs.com/cli/v7/commands/npm-exec#compatibility-with-older-npx-versions) & maybe try setting the rimraf args directly, avoiding npm's parsing altogether (ex. echo 'const child = require("child_process"); child.execSync("npx rimraf -- x", {stdio:"pipe"});' | node -) - I also noticed in your debug logs some EACCES errors which may also indicate some permissions issues but lets try the above first before we dig in on that.

The point here isn't rimraf. I chose rimraf because it was simple and common. The point is that, under the conditions I specified, running npm or npx with the stderr routed to anything that's not a tty, like using it from node, things don't behave.

This appears to have been fixed at least as of npm@8.16.0

~/D/n/s/fresh4 $ npx @gar/create-test > test; echo $status; cat test
0
Gar's test create script version 2.0.3