This link about the usage of pronouns lo(s), la(s), le(s) might be useful. Basically,
la are pronouns used to refer to the direct complement in a sentence, while
le is used to refer to a indirect complement.
Lets see the parts of the sentence in your example. Its clear that "el maestro" is the subject and "lee" is the verb. Then you could say that "he reads something to somebody". The "something" (what he reads) is the direct complement and the "somebody" (who is being read) is the indirect one. In case of doubt, the c.d. becomes the subject if you turn the sentence to passive voice ("El libro es leído por el maestro). And the indirect object usually is preceded by a prepositions like "a" or "para" in Spanish ("Lee el libro a alguien).
So you are looking for a pronoun that stands for "us", or "them" or "the students", but the important thing is that, syntactically, that pronoun stands for an indirect object.
Then check the table in the link I provided at the beginning of the answer. The pronoun that we use for a indirect object is le/les. Never "los"
El maestro los lee un libro.
is wrong, since is a case of "loismo", which is the improper use of the pronoun "los" for a direct complement.