It sounds like you are doing great!! Keep in mind that many babies learn a lot from a program like LR, but they don't show you what they know. For me it is the hardest part because it feels like my 2 year old has become an expert at showing me he has learnt nothing, yet there are times when he reads amazingly well, and recalls tons of facts and even does a bit of math and music. He shares what he knows spontaneously, at the most unexpected times. Some babies deliberately answer incorrectly to see what your response will be. There are 8 month old babies who will point to the correct answers so maybe it's got more to do with you baby's personality than his age.
I'd say that you can play the games the way you've been doing or skip them all together (the games and phonics weren't always a part of LR, yet tons of babies learned to read with it.)
My son also didn't like any part of the program that didn't have pictures, same for the colors category, but I played them anyway. Some days we would go through them quickly, others I would really make an effort of clowning about and finding objects to mach the words etc, but he generally just looked the other way.
Much later on (maybe after 8 months using LR) he started to warm up to word flash and pattern phonics.