My son and I had a hard time figuring out this reader prior to them updating for 1.0. I just looked back at my notes in the sketch when we had it working.
My note says wire TX to RX and RX to TX so try switching your wires on 2 and 3.
It was a big deal for us to originally figure out as well that standard serial was interfering with the USB connection 
that was when we first used softwareserial.
We have two of these units and we see a bug all the time. Scan card A no problem. Scan card B but bring it in slowly or pull it away quickly. It will often report the card ID of card A. I think when it gets a partial scan, it sends the last card in its buffer. I'm not sure how to clear that buffer or devise another workaround.