Fiasco 1: Reading books: unsolved

(some of this is blatantly plaugrised from the message board as i am in agony with one arm/wrist. scroll to the stars for an update)

His teacher asked to speak to me when i piocked him up on Friday. She said that they tested his reading level and got 5y11m (previous on 05/19 was 5y7m) they have colour banded reading levels he was on the 8th out of 12 but now they have put him on 2/12. He got a book the previous Monday which was Baby Whales Mistake which was a 'fluency level 4' . The next book was actually a play about a circus with words like 'contortionist' and jokes way over his head about diets. I mentioned that he struggled with understanding of the text.

During the reading test i was told he missed out words and such. I think that he was tired, and not reading slowly, also i think he was reading in his head somewhat.
She put him on this reading level to help with expression, phonics etc.
I think reading with expression is important. I hated reading aloud, i only do it now because i forced myself too when Kayne was little. The thing i can't work out is whether this is important for him to learn at 4? I mean will they expect the others in his class to read with expression? But then he is at a higher reading level than them so should his reading skills be treated at that level e.g. 6/7yrs and therefore he should read with expression. Asynchrony anyone?
If he is at a stage where he needs to learn expression, then is it reasonable to ask them to teach him about punctuation?
I arranged to speak to his teacher afterschool. I'm asked about how to help him read with expression, and about puntcuation (e.g. what will they call them etc. sometimes they use funny names to engage). I'm going to politely suggest they test him again in a few weeks because i don't feel the reading age is accurate.

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So for expression, talking in a loud voice, quiet one etc. i gave him a brief explianation of !,?" etc. We read a Frog and Toad book, he did voices! hehe, he used tone and inflection. Not all the way through but after one explaination he did well. If he does one story every night this week, i have promised to buy him a Star Wars Dvd (i think i'm mad). His book band is now the whole school reading books not just Reception books, but it is still way below his level, he entered that school at a higher level. I'm not happy about it, but she thinks that it is'where his reading age indicates'. I said that i don't think that the test reflects what i have seen him read at home....i dont think that she is buying it.
She was quick to point out that he was 'right on track' for everything else in the FSP. i felt she was saying 'hes not brilliant at everything' (not that i think he is) that he isn't anything special/exceptional.
I'm angry, i feel what happened last year is starting all over again. My heart is telling me to pull him out now and teach him myself but i'm trying to be rational. I don't understand how is teacher from last year who teaches with his current one 1/2 the day, letting this happen?
We have decided to work on expression with him, but i can't see how they expect his reading level to progress if he isn't being challenged. I feel a bit like i'm holding Mark back by the leash becuase he wants to go talk to the Headmaster and i don't want a war. On the other hand i don't want to be doing this every year for the next 10 years and maybe at one point i'll be doing it for 2 kids. Right now home schooling sounds great.

How do i know that what i think is right is right? I'm frightened that if I advocate for things that i think are his level and then i find out that he misses some important step. I hate how the teaching profession seems so secretive. I wish they would be straight with me. I wish i knew someone who could tell me what i should be doing! Or that could tell me whether he is the product of good parenting or whether he is truely advanced.