I have a personal experience with sight reading.
I learned how to play the piano by the Suzuki method, which is learning by mimicry and not by reading. So I never learned how to read music but I could still play the piano well. I learned how to count of course, but it was a little bit different compared to reading sheet music. If you are able to internalize the rhythms, you can get by with minimal counting.
Once I learned how to sight read, my ability to internalize music severely diminished. I felt my creativity being hampered. I was told that it was necessary to learn how to sight read, but I think that statement is grossly exaggerated.
I think sight reading is a useful tool, but I wonder how much benefit there is for it beyond composition. I think it could actually be a crutch for someone who aspires to learn how to internalize music, which also includes being able to understand rhythms.
I loved playing Jazz for this reason. You couldn't just go strictly by the sheet music to understand Jazz rhythms. You had to learn how to "feel" it. As infuriating as that sounds to some people, it's a true statement.
A comparable analogy is that you can't learn how to swing in Jazz by counting numbers. In dance, you can't learn how to swing by counting 123, 567 either. There will be exceptions, but generally I find that counting as a way to learn rhythms is bad.
@Latinjazz, I would be interested to hear your opinion on this.