DD is only 2 (late July born) so haven't yet had to face this issue but it is something that I've been thinking about already. At the moment she goes to nursery 2 days a week and absolutely loves it; as she gets older we'll gradually increase the nursery time. Although she's bright (certainly well ahead on all the language/communication milestones) I don't yet know how she'll be in terms of school readiness.
I don't know all the ins & outs of funding, but (if that wasn't an issue) it seems to me a bit of a no-brainer, given the choice between staying an extra year in nursery, where she'll have all her friends, in a small group, with high staffing ratio, where they're learning to read & write etc as well as having fun - and going to a new school, when only just age 4, to a large class with fewer teachers/staff.
I may feel differently about it when the time comes, but surely that's the point that so many of you have very eloquently made - that there should be flexibility.
FWIW, I'm late June born, went to school the Sept after my 5th bday (into Yr 1, not reception) and was about 4th youngest in my year throughout primary school. I don't think I suffered adversely because of it, and was in fact glad of the fact when I ended up retaking A levels and going to Uni a year later than many of my friends (but was still not much older than those who'd gone straight from school).
However, as others have said, birth date may not be an issue for some, but the stats clearly show that for many it is a factor in settling in/getting on well at school (socially and academically) so it should be taken seriously.