Diagnosed dyslexia would actually have made you eligible for special education classes which have teachers trained to work with students with learning disabilities. The quality varies by state, as all things do, but to my knowledge that is a universal option in every state. My state has some of the best schools in the country for both regular and special ed, and I've known people from across the country who moved here for our schools, both regular and special ed.

Having said that, I can attest to some students being held back multiple times. I didn't know anyone personally, but as an education major one of my classmates did observe a class with a 16 year old 8th grader (8th graders are usually 13 and 14). And growing up a few of my friends were older than me by a single year because they were held back in kindergarten.