I think the question to ask is, "What would you recommend for a bright student in the "age appropriate" grade who has difficulty with handwriting?

Teacher: "Umm, (throat clearing) well..."

You: "You would not suggest that he be held back, would you? You'd assign him OT or get him access to a keyboard, perhaps? Surely you wouldn't put him back a grade, when he has already demonstrated that he is ready for more advanced coursework?"

Teacher: "I think we need to get the principal involved in this discussion..."