LMS, you are raising a clone of my son. Both my husband and I were self-taught readers by age four or so, so it was surprising to me that neither of my kids were. (My EG/PG daughter with a VCI of 166 didn't fully emerge as a reader until 7, but was reading three or four grades above within six months.) At four, my son knew all his letter sounds and could sound out words and even recognize some sight words, but he wasn't reading or anywhere close. We used Dreambox too, and my son stopped a couple of times because it got too hard or unappealing, and I had to help him over the "hump."
I suspect he may also be a VS learner. He hasn't been tested except for the Peabody Picture Vocab thing, which I understand is a quick and dirty IQ test. According to his standard score on that, he is highly gifted. We have always homeschooled, and I tend toward relaxed homeschooling, if not outright unschooling.
My son has a strong personality. He has a mind of his own. It is a lovely trait in a way. He tends to get fairly obsessed with things and pursue them passionately, and then move on to something else. Here are some of his passions starting around age 5, and up until now: chess, animation, computer game design, drawing, Tolkien, foam weapon design, Dav Pilkey, building backyard forts, writing novels. These passions tend to circulate. Some go away, and then come back.
If I were to make him do something when he was younger, he would fight me hard. I think I handled this by seriously restricting access to things I didn't want him doing -- TV and video games -- and when he got hooked on something I found to have academic value, I let him go as long and hard as he wanted to, and even supported it.
Now that he is older, we do have more "have tos" in our homeschooling life, and he is grumpily compliant.
I will say this about the reading in particular. I really wanted to raise a kid who loved books, and when he was a toddler, he wouldn't sit still long enough for me to read to him. There were a couple of strategies I employed that worked.
First, I set aside some special reading time that included a caloric incentive. I would make some herbal tea and offer a small plate of cookies. We would sit down together, and while he ate his snack, I would read. Because we did this every day (or nearly every day), it became a bit of a ritual.
Second, audiobooks. Lots and lots of audiobooks. At that age, we listened to Lemony Snickett, Junie B. Jones, Wayside School, and Geronimo Stilton. (My son loves humor.) We downloaded them from the public library for free, and both my kids had their own MP3 players. We listened to a book every time we were in the car, and I always put on a story CD at bedtime. To this day, we still listen to books in the car, and my son loves to fall asleep listening to the Norse legends.
Because I wanted to discourage screen time, I would also plug him into an audiobook when I needed to get something done. The Harry Potter series gave me hours of work time!
This past summer, my son turned eight, and he still wasn't a fluent reader. There were some really funny patterns too. He would get hard words correct, but not be able to decode "parties." I dragged him around a bit trying to get him diagnosed. (Hence the PPVI.) He tested at 7th grade for reading comprehension, but only low fourth for speed and accuracy. It was all above grade level, so everyone was telling me not to worry, but I know that that kind of discrepancy can go along with stealth dyslexia.
He saw a developmental optometrist last summer who diagnosed him with far sightedness. We did vision therapy for about four months, and now he uses glasses to read. His reading is much, much better. However, he still misreads words fairly frequently, and is a bit of a reluctant reader. I am going to have him fully assessed for dyslexia in a couple of months.
In the meantime, I got him a Kindle Fire for Christmas. I used the parental controls to lock out games, internet etc. and it is a device we use only for books. You can make the type face larger, and change the background color, something that can be helpful for dyslexics, apparently. It also has a "cool" factor. We download books and audiobooks from the library, and he can go into my Audible library and download any audiobook I have ever purchased. He uses it every day for either audiobooks or books.
I think your son is young enough that you don't need to worry to much about "forcing" him to do much. The reading may come soon, or it may not, as in my case. My last bit of advice is to take a look at Readings Eggs. This is an on-line reading program that is similar to Dreambox. My son didn't hate it, and it did help with phonics. I believe there is currently a discount on it at homeschool buyer's co-op.
HTH!
