Hi again, Stereolab! We 'met' the other week, and I DID have a listen to the band, but not yet done it justice.
'mrz' is an undisputed expert in these matters, but despite that, when I was first a Teaching Assistant in a UK infant school over twenty years ago, WE were using Letterland: the children divided a page in their work books into quarters, and wrote four words starting with the letter being learned, and illustrated it with a small picture.
They were also taught pairs of letters that went together, such as 'tr' and I well remember getting my small group of Yr1 children to learn 'train' 'truck' 'track' 'trick' etc etc.
By today's 'modern' methods of Phonics, Letterland probably took longer for the children to become proficient readers, and they probably wouldn't have the understanding to support good, accurate spelling. But, the vast majority DID learn to read, and I don't think any serious damage was done to their education.
You obviously aren't going to get the school to change their methods, but provided you support your child in a sympathetic way, it should be possible to merge school methods, with UK phonics methods, and I don't see why one system should be adopted to the exclusion of the other. The important thing is that DS learns to read, enjoys reading, and before long, learns to write and spell.
If I didn't mention it before, in MN Book Reviews, "Children's educational books and courses" section, the Oxford Phonics Spelling Dictionary is featured, and I think you would both find it interesting and useful.
Feel free to come back if we can help any more, and I am sorry that you are being presented with this dilemma.