#1-- absolutely not-- as you observe, it's a matter of fluency, really.
#2-- until about 4th-6th grade, unfortunately, it's a distinct possibility.
Hopefully if they DIBELS him or anything, they'll level with him about what is being evaluated and caution him to be reading exactly what is on the page. With my DD (who also did this and still does, and starting at about this age, too) that was enough. She can read verbatim. It's just easier and more natural to read aloud with meaning and listener engagement as the top priorities instead.
