I like your original proposal. Since this is an assignment your DS is doing at home, you can let him do it on the books he's reading at home. Then just sit back and wait until the teacher decides to complain.
Their only argument that had any teeth was that they feel uncomfortable because other kids will not be able to read those books but we told them we would absolutely make them available to others and/or donate the books...
This is where my strategy of pruning bad arguments by refocusing on the school's mission comes in very handy: "My child does not come to school to make other children feel comfortable. My child comes here to learn."
