Last week, Chavie suggested that I have Thing 1 practice her Hebrew reading using perakim from Tehillim. Just have Thing 1 read the same perek over and over again until she can do it perfectly.
So, we started with the 117th chapter (because it's really short--only two pesukim), and Thing 1 has read it three times a day for the past three days. Today, she rattled the whole thing off without hesitation.
Good. Now for step 2.
I decided to use a Charlotte Mason idea for this one. Now that she can read it all and can sort of recognize the words, I copied the perek and cut all the words apart. Then, I rearranged them into short sentences. Thing 1 now has to practice reading the words out of context! My hope is that enough words from the siddur and the Chumash are in Tehillim that Thing 1 will have enough of a base of sight words to read without agony.