But to digress away from pronunciation, for a minute...
I don't think that guessing is a bad thing. Learning how to make good guesses (not necessarily getting the answer 100% right, but getting a good-enough answer) is an important higher-level reading skill.
The thing I find depressing about phonics, and I say this as someone who teaches reading further along on the educational process, is that it tends to equate reading with decoding. Now, it's great to be able to decode 'The multitudinous seas incarnadine/ Will not make this hand clean', but that won't tell you what it means. Guessing is a vital strategy, because it gives you a rough idea of what the word means, enough to get the main sense of the whole couplet. (I know, yes, look it up in a dictionary. But being a fluent reader is partly about being able to jump over gaps and to fill them in with good-enough guesses.)
So an approach that encourages children to treat meaning as central to reading, by encouraging them to guess at words, to use context and inference, is actually very good for helping them to develop as higher-level readers, not just decoders.
This may be me being a woolly liberal, but it seems to me that children need both sorts of approaches, phonic and whole word, because they work on different parts of the reading process.