Our school uses a similar approach to ultramarina's; the kids read whatever they want (at home or for free reading) and have individual work related to that, and then there are in-class books, sometimes whole-class, sometimes small group, where they have discussion groups and projects. I find the whole leveled-reading thing quite strange, to be honest. I remember several conferences where the teacher mentioned the measured level, then said something to the effect of "of course, she is probably really at about xx, but they don't let us test that high..." And we would all smile and move on. For kids like ours, I think the levels are pretty meaningless, and thankfully our teachers seemed to agree. There was no attempt by anyone to control or limit what our kids read, and the whole library was open to every kid, every book.
