[clivehawkins]

Yeah, why do we do it? I've seen classes where the teacher gives a reading comprehension exercise out of the blue with no explanation and then scratches his head when the response is pretty flat.

Like with anything in our field, I'd say that a lead in is vital. Create an interest in what they are about to read. This can be eliciting what they know on the subject, getting them to predict what they are going to read from some key words etc etc. Without this stage there is no focus.

Then I'd get them to read, with the aim of answering some general questions.
I'd ask them to underline any new words at this stage rather than go into it then.
Then I'd get them to check their predictions \ the info I'd elicited.
Next we'd read again with the aim of answering more detailed questions.

Any new vocab can be dealt with at this stage. Students can pool all the words they'd underlined and create a new list to learn.

Finally I'd try to generate some discussion on what they'd read, either through questions and answers, a role play activity, a survey etc.

The answer to 'why' is to improve their reading ability, meet new vocab etc. If we can give them confidence to read and identify important information then hopefully they will get the reading 'bug'. If they can be taking home a Graded Readers every couple of weeks then this is a real positive.
I prefer reading to listening when the group is of mixed ability because each can read at their own speed and you can ask the stronger students to do other exercises while waiting for the others, such as identifying verb structures, negative adjectives, changing verbs from positive to negative etc.