My DD was similarly advanced as a reader when she started school. To be honest, it wasn’t much of a problem in Reception, as she quite enjoyed the short phonics sessions anyway, and her experienced teacher found little ways to challenge her without drawing attention to her too much. Also, the free play nature of reception meant that she could develop all the other important skills. She didn’t often read to an adult because they needed to concentrate on those that were behind, but her teacher would check in with her occasionally and challenge her comprehension/inference skills, and she didn’t hold her back in terms of book bands either: she was on ORT Brown (the level above Lime: Y3 level, I think) by May of reception. This was seven years ago though, and I think the phonics teaching might be a bit more restrictive these days.
We did occasionally have to ‘pull’ a book that was too emotionally charged for her actual age/maturity, but once we realised this was a risk, we were careful to check the books. We made a great deal of use out of the local libraries too, with library cards in two local authority areas, to maximise the opportunity.
I think you probably are expecting a little too much in terms of differentiation at school, but the great thing is that reading can easily be extended at home. You are probably not realising the little things the teacher is doing with your DS as well: we gradually realised from conversations with DD that her teacher was encouraging her to think of alternative words/phrases, challenging her spelling, punctuation and subject knowledge in various ways, mostly through day-to-day conversations in the classroom. Phonics sessions and 1:1 reading with a teacher are only a small part of the experience.
As for those saying that your DS isn’t so unusual, I’d be inclined to disagree. My DD was definitely a significant outlier throughout KS1. I wish she’d had a couple of similar children in her class of 30, but she didn’t – it’s just the luck of the draw. She still loved primary school though.
Above all, remember how lucky you are: your DS has such an advantage as he can acquire knowledge that the non-readers are missing out on, and he will have a confidence that won’t easily be dented. Keep encouraging him at home, and be thankful that he’s enjoying school.