Are scales and arpeggios that important? My teacher makes me do them every week and I don`t see how they would help me. Also does anyone have any good tips on getting better at sight-reading. I mean that`s basically the only thing that I`m determined to be able too do before I finish lessons. I mean I want to get as good as my teacher is. He can just pick up any peice and start playing it right on the spot. If anything thats what I want to be able to do. But how do I get to that point? Whenever I see music it just looks like a bunch of lines and dots to me. It just amazes me how people can do it.

Many years of practice...

Yes technique is important. It affects your playing in all aspects

crap, so it takes more than a couple of months to get good?

Well...yes.
Piano technique is one of the hardest things to master. If I were you, I`d work on one key every week. In that key, do scales, chord, broken chords, arpeggios, octave scales.

But that`s not all. There are still finger dexterity excercises, scales in 3rds...

Try picking up a book dealing with piano technique.
Two that I`ve used are Dohnanyi Essential Finger Excersises and Ernest Hutcheson The Elements of Piano Technique. These would be supplementary to scales, chords...

Give it two years and you should be able to earn some freedom on the keyboard

Scales and Arpeggios:
Why do u think examiners make u play em for exams? If they aren`t important why is it a compulsory study in the exam syllubus or auditions( in general ) then?
The purpose of playing scales is to develop reliable technics, among which are strong, good hand shape, good finger reflex and execution, sensible touch, and most importantly, strong hands. U may not sense all its importance now, but as u played more technically demanding pieces in years to come,you`ll be glad of all the exercises u get doing scales years back ago.
And I would strongly encourage u to do scales as warm up and down ex. And, arpeggios and broken chords are a must! If u can`t handle the scales and arppegios now, it`ll be tenacious to do the Beethoven and Mozart when you do your diplomas or college in later years. Look at the melody structure and you will understand.
And through scales, you`ll develop a good pearly touch, which is essential for Mozart and Bach.

Sight reading :
I find that `Improve your sight reading` by Paul Harris to be most helpful for a progressive study, and Hal Leonard`s notespeller is excellent for kids.
There are certain things one can do ( specially recommended for people with poor co-ordination or slow note reading. )
1. U can memorise some space or line formulas as guidelines to help u read, and it`s easy to navigate around em.
Treble(space notes)_ FACE
Treble(line notes)_ Every Good Boy Does Fine
Bass ( space notes )_ACE is Good, or, All Cows Eat Grass
Bass ( line notes )_ Good Boy Does Fine Again.
2. After u`ve got that in yr head, yu learn to navigate around the staves with that. U do written ex. of note spellers, then gradually leading into verbal ex...as the main difference between written and spoken form lies in the speed.
3. Then, do Hal Leonard`s advanced notespeller whereby they make u learn to read notes in shapes and intervals...this is esp. helpful for chordal playing. And they make u recognise different intervals such as steps(2nd), thirds( leaps), fourths and fifths and so on.
4. Try Paul Harris`s clapping ex. The purpose of doing clapping is not to check the rhythm, but to work on the co-ordination between the 2 hands. So often have I seen teachers making students do these clapping ex in two seperate lines, which is really wrong. Let the kid clap the 2 lines at once, so it`ll be pretty mucgh like playing on the piano itself. Right hand for the upper line, and left for the lower line. Start with really simple rhythm, then progressing into dotted rhythm, triplets and so on.
5. Now, here is when the actual playing comes in...after the student is equipped with adaquete note reading abilities-Pls note that the student does not have to read every note itself, most often, they are encouraged to read in steps and shapes, to ensure a good flow.
Start with real simple ex that anchors around the key note and moves in steps, then progress to leaps of thirds, then 5ths.
4th will come in by itself, so long as they can tell the difference between 3rds and 5ths. And methods as such work not only for chords, but for melodic progression also.
Both hands always seems more tricky. But it`ll be tackable if it`s done systematically. Start simple BH ex with `false` BH playing. RH doing steps and leaps, and LH with tied notes, or occasional `shapes`...preferably 5ths. Then take it to the next step, LH in steps, and RH with shapes....and so on.
And the ultimate element, is the ability to read ahead. Choose spaced out rhythm such as minims for a head start, and perhaps chords...since shapes are easier to identify. So, it`ll go like this: 0 read, 1 play, 2 read, 3 play, 4 read the next bar, 1 play... and so on.
Then, finally it`ll develop into something like this... 0 read, 1 play, 234 read, 3 play... This means that they`ll actually read 1 whole bar/phrase ahead.
And lastly, always remember that chordal progresisons are always easier to sight read, it`s the linear ones that are difficult.

scales build up coordination and improve your ability on the piano. not to mention they come up in sight reading also (same with appegios and even the dominant seventh arpeggios).
interms of sightreading, this ability is based on the conditioning of the brain. Think of it interms of english literacy for example. you don`t actually read one letter at a time- o-n-e- l-e-t-t-e-r. that is slow, but as you brain is conditioned, it recognizes groups of letters, and even chunks groups of words together for effecient and fluent reading. Same goes with music literacy, scales are the very basic vocabulary of piano literature and are a requirement for good piano/reading skills. But this is only a small portion of your vocabulary which is why we learn repetoire. We work out problems in etudes. When the problems are perfected, we recognize them in music and play them at sight.

I reccomend a few types of reading. The first are easy pieces you can read without any mistakes. The next, are medium leveled pieces at a moderate tempo. Play through them WITHOUT stopping at a steady beat. the third type are harder pieces which whould be practiced slowly with the metrenome with no mistakes.

the texts I reccomend.
Sight Reading at the piano, by Robert spillman (eastmanschool of music publication)
The Art of Accompanying, by Robert Spillman- this is much harder than the first
(eastman school of music publication)
Also for additional practice, read hymnals from cover to cover. If they are harder to conceive read them hands seperately a couple of times before putting it all together.

The last level of sightreading is conceiving open score (usually only practical ifyou plan on accompanying a choire). In this case read alto and soprano alone in your right hand. Read tenor (play this an octave lower than written) and bass in your left hand. Practice hands seperately.
final point, there is no such thing as a sight reader who is born. This takes hours of practice. Reading music 5-10 minutes a day will show very noticeable improvments within a year.
Don`t set too high of expectations that are unatainable because you will just dissapoint yourself. Also remember that your teacher has probably practiced reading for 20-30 years. If you notice improvement in 1-2 years, impagine your progress 20 years down the line. With our improvements in technology and pedagogy, children start earlier and make quicker progress than their teachers. You may already be ahead of your teacher when he/she was your age.

That is my million dollar lesson, now practice for 10,000 hours and good luck