Lox - this is from the OP: "heard a guy tell someone that last night. "I've studied guitar for three years and my instructor says there's no such thing as a B-sharp. It's a C." So either the teacher is an idiot who shouldn't be in that job or the guy misunderstood him. "
josepp is reporting hearsay. We have no idea what the teacher actually said, or why. It may have been wrong to suggest this, or the teacher may have merely been trying to simplify things to show where to place a finger on the fretboard, or - as stated, the pupil may have merely misunderstood, or josepp may have misunderstood. We don't know.
It is josepp's statements in subsequent posts, which appear to suggest that being able to read music and understand the more complex conventions of written music theory is necessary, (and failure to do so verging on cultural criminality), that have brought out so many opposite views.
Telling someone there is no such thing as B sharp is not a crime - because they can find out for themselves later on, IF they need to, when and why we decide to use this name for that note in certain, fairly rare, cases.
It's a concept that does not really crop up at all in trad folk and very seldom in contemp folk (joespp's example song "Where Did You Sleep Last Night" is of course VERY firmly in the latter category ;-). A rock guitarist who does not know about B sharp is not going to be very handicapped - it just doesn't occur in rock music conventions (which, actually, tend to be even more aural/show-and-tell than folk music conventions, as it happens).
Trying to explain too early, to someone who may be struggling with the terminology, and who may never need to know anyway is not necessarily good teaching. Could be very bad teaching, actually.
Mozart almost certainly learned to play by ear first. I could pick out a tune with chords on the piano at the age of two and started on the violin (1/8th sise, got for the family by Clara Schumann) at the age of three. Both my sisters and both my children could, like me, also read simple words at two (my daughter could recite the alphabet backwards at 2) - but we ALL mastered speaking before reading. Everyone always does.
I did not say people should not try to read music, or did I? No, I see I said that it was an advantage, and so it is. I did say, however, it was not always necessary, or possible, and could even be a hindrance if taught too early and/or too rigidly.
"The idea that being able to read means you cant' speak is not true"
I did not say that either. I would have been even stupider than usual if I had.
"or in musical terms, play without dots."
Ah - but there I beg to differ. I have met hundreds of people who have been musically damaged by being taught book-music without ear/heart-music. I actually believe it verges on abuse when inflicted on small children.