Dyslexia is associated with abnormal performance on many auditory psychophysics tasks, particularly those involving the categorization of speech sounds. However, it is debated whether those apparent auditory deficits arise from (a) reduced sensitivity to particular acoustic cues, (b) the difficulty of experimental tasks, or (c) unmodeled lapses of attention. Here we investigate the relationship between phoneme categorization and reading ability, with special attention to the nature of the cue encoding the phoneme contrast (static versus dynamic), differences in task paradigm difficulty, and methodological details of psychometric model fitting. We find a robust relationship between reading ability and categorization performance, show that task difficulty cannot fully explain that relationship, and provide evidence that the deficit is not restricted to dynamic cue contrasts, contrary to prior reports. Finally, we demonstrate that improved modeling of behavioral responses suggests that performance does differ between children with dyslexia and typical readers, but that the difference may be smaller than previously reported.