Kyle Reese realized he was John Connor's father before he died.
He knew that John Connor's father died before the war, and even if John didn't inform him of his age he knows John doesn't exist yet in 1984. Obviously he wouldn't even conceive of the idea until time travel becomes an option, but once he's back in time and is in love with Sarah the idea he's John's dad becomes a possibility. Once Sarah reciprocates this and they conceive John, him being John's father would be a near-certainty as among other things it explains why John encouraged his crush on his mom, and mentioning certain details while also leaving things out. It also meant that he knew he was going to die relatively young, which'd add an additional layer onto his courage in the last stand against the T-800. Assuming a Stable Time Loop isn't in play, there are at least three timelines before the events of the movie.
Based on a common theory that Kyle Reese wasn't always John's father, and mainly to rectify the paradoxes that the sequel creates. Each timeline comes closer to the events of the movies we see, with Timeline 4 being the first Terminator movie. This goes by the idea that alternate timelines can co-exist via the many-world interpretation (think Dragonball).- Timeline 1: John-1's father is unknown, but since there's no Stable Time Loop, it's certainly not Kyle. Likewise, because there's no Terminator parts, Skynet-1 is made later. What becomes of Sarah-1 is unknown, but she probably never became a hardened badass and may even die during Judgment Day. John-1 rises up not because of Retroactive Preparation but his own leadership merits. Kyle-1 volunteers to stop the Terminator-1, without any ulterior motive by John-1. This date may also be later than 2029, as without knowledge of the future, it would make sense that the war lasts longer.
- Timeline 2: Kyle-1 isn't already in love with Sarah-2, but the two eventually fall in love and conceive John-2. With a different father, John-2 may be a completely different person than John-1 (including different genes, appearance, and personality — basically making him "John Connor" In Name Only). Kyle-1 probably dies like before, the Terminator-1 is crushed at Cyberdyne like before, and Sarah-2 is driven insane by the knowledge of the coming apocalypse and prepares John-2 to be a great leader. John-2 later meets a young Kyle-2 and, realizing that it's the "father" he never knew, begins grooming him for his future mission. As before, Kyle-2 is sent back to 1984 to stop the Terminator-2, this time at a date closer to 2029 thanks to a much more prepared John-2.
- Timeline 3: Basically the events of the film. Since Kyle-2 describes John as being a combination of him and Sarah, we already know that John-3's parentage is locked in. Kyle-2 is also the first that felt Love Before First Sight for Sarah-3. We already know the story from here: Kyle-2 dies, Terminator-2 dies, Sarah-3 goes crazy, John-3 grooms Kyle-3 and defeats Skynet-3, and then Kyle-3 and the Terminator-3 go back in time.
- Timeline 4-?: The movie we got, with Kyle-3, Sarah-4 and Arnie-3. There could technically be an infinite number of minor variations on this Stable Time Loop up until the events of Terminator 2, where the heroes destroy Cyberdyne and that results in Skynet either being created much later than even the first timeline, never being created at all, or replaced with Legion.
