I read books in class as a part of 'Reading Time.' Reading Time is just a small segment of the class where I read to the students. I start by introducing the book. I show the book and read the title. We look at the cover and I explain as much as I can about the setting, characters, and story as I can. I might ask some questions or verify understanding with yes/no questions. Then, I read the story to the students one time all the way through. I read it a second time, pointing out things in the pictures as I read. Finally, I ask some questions about the story. I ask whether they liked the story and if they want me to read it again some other time. This style is called the preview-review method.
I do this with students up to the age of 8-9. I don't use reading as a tool to introduce or teach structure. I just read to students to expose them to more language. In this way, I can read just about any book that is at their level.
There have been many articles published on the benefits of reading in language classrooms. I recently wrote an article review of 4 studies from 1999-2004. If you'd like I could send my review to you. It might have some helpful info in there.
I also did a show over at eslTeacherTalk about reading in class and my ideas. There might be something there for you as well.
http://www.eslteachertalk.com/2006/10/reading-in-class/