They do it at my dc's school, and in all honesty I don't particularly like it. I think the schools do do it very carefully with lots of consideration for all children, and how they're going to mix them. However, although there were tons of parents up in arms the first time, I am unusual in that I have stayed not liking it, most are fully in favour having seen it working.
Sometimes the school disagrees with a parent on how they think a child will be best supported. After it's done, each year, there's always a few parents who think the school's made a mess up. I would say about 50-75% of those parents are saying by the end of the year what a good decision the school made in retrospect.
There's no way they could have a whole parent consultation on such things like that. Think about it-30 sets of parents, probably a good 40 different views. And then you would get other things the parents thought they should be consulted on.
I'm not sure why you think parents of SEN children should be given such information first either. If they tell a few parents then this will almost certainly lead to rumours and misinformation going out. Much better to tell everyone together and stop the rumour mill. Of my dc, the one who found moving up classes traumatic is my one who isn't SEN, so if you'd been told first then there would be another parent saying "my dc needed to know earlier".
The way it works at my dc's school is that at infant level, about this time they start doing thing in different groups with the other form. So they get different groups mixing together. They use this to fine tune the reordering, and by the time the class lists are given, they've been doing a certain amount of stuff in that group for a bit. They let you know about this time of year that they will be mixing the classes up, but you won't get the new list until about the end of June.
At junior level they ask the children to name up to 3 children they do want to be with, and ask parents to contact if there is any they don't want to be with. The head also invites any parents to come and discuss with him specific concerns. They then sort out between the current form teachers and the head.
It's a very long drawn out process, and I don't think they would do it if there was any thought of it not being for the best for the children.