I think the educators (without knowing them) probably have the experience to be able to recognize the signs way before an official diagnosis can occur, and the IEP will give him access to every kind of special service and additional help he can get at the schools.
My son didn't have dyslexia, but he did go to Title I reading services for two years, and it made an amazing difference. In the schools, it sounds like they are VERY on the ball where you are if they have already set his IEP. This could have gone undetected for so much longer. And really, he is getting intervention as early as has been possible-- because they are taking the approaches of helping him already, and even if he doesn't have Dyslexia (which I suspect he probably does, based on their evals), they will be giving him such individualized attention and specialized care that it WILL make a difference.
My almost-11 year old has Asperger's and we ALL knew it before he was officially diagnosed, even though he had to go through an official battery of screenings that took about three hours to do it. So, yes, the diagnosis for your son will require all of those evaluations, but usually teachers and tutors who have seen several kids who have already been diagnosed know what the early signs indicate. So, I don't think they are stabbing in the dark.
I used to work in special ed-- and we NEVER suggested that a child needs screening unless he or she did, because that can mean (if not handled appropriately) that the district ends up paying for it. So, I don't think you are being steered in the wrong direction.
I think everybody is doing what they need to be doing, from what you have described. And I think if you talk to your son about what might be happening and explain that this is common (point to Tom Cruise-- his pic is everywhere and he is a very famous success story of someone with dyslexia, who also needs to read to make his living! also Patrick Dempsey, and I know there are other celebrities, but those two come to mind), and also that it makes him special. When I told my son he had Asperger's, I was nervous, but he was so happy to know that there was a name for why he was different, because he knew he was.
Your son also needs to know that this has nothing to do with intelligence-- which I suspect is his main concern. He is probably too young to know what X-Men is-- but all of the people in X-Men have abilities that can also be seen negatively, and that is sort of like dyslexia: He can see words in different ways. So, it is going to be its own kind of super power to be able to turn this into a strength and work through this to read. But he WILL do it.
Feel free to continue this thread with any questions, suggestions, further info, etc. you have!