I also think that there is a lack of thought put into "next steps" for gifted readers. At a certain point, "harder books" is not the next step. Thinking about high school english classes, for instance, the goal isn't to give students progressively harder books, it's to change the way in which students interpret and communicate about the books.
Yes, absolutely. There may also be a question about which children we're talking about. I read somewhere that very early fluent reading is actually better correlated with later talent in maths than with later talent in English, and that makes sense, precisely because of the shift you're talking about. In the early years, English lessons are a mixture of symbol decoding (reading) and fine motor skills work (writing), mostly. So a program to identify, early, the children who most needed extension in English (most of you say "language arts" I think, which is a better term perhaps but not one I'm familiar with) would need to do something different from looking for children who shone at the age-typical curriculum.
