Epitaxial means that the structure of the substrate unambiguously determines the structure of the growing film. This is not specific for nanofabrication, but of course it also applies to it.
You may have to select a substrate which matches closely with the structural dimensions of your film material (lattice mismatch should be as low as possible).
It will allow the oriented growth of a film, which can have superior properties along a preferred orientation, and can be useful nywhere, devices, or nano fabrication, specific property enhancement etc.,
As this growth mechanism suggest the replicating the base/substrate or previous layer of atomic arrangement....if at nanofabrication the structure is having very low dimensions and few atomic layer...may be it is difficult to exactly follow epitaxial growth mechanism...but more layers can be analyzed for the same.