I just discussed this with our ped at dd's 2yr check-up on Monday. Dd is 5% for weight (22lbs on a good day), so he said it was ok to leave her on whole milk until 3yrs, then switch to 1 or 2%, but generally they recommended switching at age 2. He also noted that whole milk is a significant source of cholesterol (and we need to be worrying about that even at this age), so it's not just the fat intake we're monitoring, but the cholesterol as well. He also said they have raised the recommended intake to 24oz at her age (I had heard 16-18oz).