My DS also took the DAS-II lat year and DYS accepted it. It is on the approved list but it was not when I looked the first time (he had taken the DAS-II at 3.5 as well so I was curious if it was an approved test).

It does sound like your school is at least willing to make some accomodations which is wonderful! My son's school last year was not willing to do anything - even after all the testing they did he still had to sit in the K class AND do all the K work though they knew he was reading at a 2nd grade + level and doing 2nd/3rd grade math.