Jool, generally what you say when you answer those questions is what you should say in your writing.
I think I would recommend that you write pretty much what you wrote in your messages to me and to Cathy A, just "teacher-ified" for your audience. Maybe stress that he's a teacher-pleasing kid, and that you would prefer that he make mistakes and take risks rather than being "perfect" all the time. That allows you to say that he is ahead of grade level and that keeping him challenged may require her to give him harder work...without your sounding like you don't trust her. (You could even mention the problem last year--in a fairly positive "here's what I learned" way, of course--if it seems appropriate. That's a bit trickier to do well, so be careful.) I think that really stressing how much you like mistakes tells her that you're not one of "those" parents. They want perfection, not learning.
Tell her what he likes to play with and that you really value his having time after school to play. This gives her an insight into his personality and stresses that you're not a pushy mom.
Of course, I wouldn't mention the possibility of afterschooling in the letter. (But if he does wind up being underchallenged in class, mentioning his afterschool playtime pursuits sets you up for a LATER discussion about why a lack of challenge is a problem--"to keep him happy, I'm having to teach him at home, and he's missing out on play time..." Planning ahead!)
If you want another pair of eyes to look at a draft for you, I'm happy to help. I might as well get some use out of this English degree!
