You can do it without, although if you're watching a DVD or something, your neck can get sore from looking up. Position is a bit "downhill", but that won't affect your training much if you're pushing it hard.

Still, I recommend a block for stabilizing the front wheel and also getting the height up.

Phone book works ok unless you sweat a lot - I can kill one within a week, turning into a pile of mush.

Its worth the small investment to get a plastic one IMO.