I have been slacking on how much I practice to read music so I'm still in the first position trying to get it down solid. Sharps and flats make me stumble a bit too.

As far as which to learn, I personally see it the opposite of what you said samata. To me theory is the more important one. Sure you can learn to read perfectly, but that doesn't mean you understand what you are reading. Anyone can be trained to look at a note and know what it is or where it is on the fretboard, but learning theory is much more than that. It's what ties everything together with sound and how you play.