I don't know how to ask this without sounding judgmental but I think it's important and will help you get better answers. The post that you wrote above is barely readable - is that because you wrote it on a phone in text-speak or does it reflect your own level of literacy? I ask this because if this reflects your own abilities, perhaps his performance in school is reflecting your own school experience? In other words, did you have the resources to make him ready for school and do you have the resources to continue to support him? Was he enrolled in pre-school? Did he have exposure to letters, words, books, number concepts, age-appropriate concepts of math and language? If your own educational experience was not great and you really don't understand the situation, is there someone you trust who you can enlist to help you out? Maybe someone who knows your son and the school who is someone you like and trust can get to the bottom of what's going on and help explain it to you so that you can make the best decision for him. When my oldest son was struggling in the early grades, another mom I know with older children was very helpful in helping me navigate the system, so to speak, and it's a common recommendation that parents going to school meetings (particularly for special education but this applies to any meetings) bring a support person with him or her because it can be overwhelming to sit there while they tell you everything that is wrong with your child and if you're shocked or frustrated or embarrassed, you might miss some of the important things that they are telling you.
Also, there are four months left in the school year and you don't have to decide now. Ask what, specifically, they would like to see from your son to demonstrate his readiness for 2nd grade and ask them specifically what you can do to support him as he tries to reach those goals. Are there certain behaviors they want him to display in the classroom? Do they want him to practice reading and writing at home, etc. They should be able to write down for you the areas in which they are concerned, how those deficits are measured, and what you can do to overcome those. If it's just a matter of helping him get into gear and mature a bit, perhaps that can be accomplished in 4 months. If not, then at least you know what they are measuring and will have a clear idea of why they recommend holding him back.
Good luck to you, and again, I hope that I didn't come across as judgmental, especially if you posted via a device that does auto-complete or makes you hit shift to put in punctuation, etc. I hate writing anything with my BlackBerry because it invariably comes out almost unreadable!