If my 16 year old son had sex with a 14 year old minor, can you please tell me if he can be prosecuted and, if so, what for (a felony or misdemeanor)?

Because he is 16, he would be prosecuted if at all, as a juvenile.  The juvenile system is significantly different that the adult system in that it is a hybrid of civil and criminal rules. 
However, the main issue will be: did he commit an offense.  If the sexual relations was consensual... then this is just a teen sex case.  If the young lady alleges that your son forced himself on her, then there would be an alleged offense... based on a non-consensual act.  Your son's defense would be that is was consensual.
I know it's easier said than done... but your son's best course of action going forward is simply to abstain.  This is not to say that all young female victims are "liars"... but many are certainly confused about their emotions and bodies.  Often, they will claim that the initial "touchy... feely" was consensual, but that "he just kept going even after I said no."   Thus, mid-way through, a minor miscommunication turns into a huge life-changing event:  A charge, an arrest, and a permanent public scorning.  There is no amount of physical gratification for your son that is worth the stigma of the sex offender label.  Tell him to stick to older ladies and check their ID.