Otisthecat: you aren't doing anything wrong. In fact, 7 pounds in 2.5 weeks is fantastic. You only want to lose 30 pounds so that's already 23.3% of the way to your goal! That's fantastic!

If I were you, I would leave off the bread for breakfast and substitute some sort of protein: eggs, bacon, leftover chicken or beef from the night before.

I know the bread is low carb but some people are sensitive to grains. It would be better to choose from the Induction List for a while and just increase the amounts to raise the carbs. The lower on the GLycemic Index your food is, the less your sugars will be affected.

Lots of people here are managing their Type 2 Diabetes by LCing and you can too. All the best.