I wouldnt guarantee it but I dont think its vital to the functionality to the phone. I'd say at best it filters any dust and debris that might go through that hole into some sensitive hardware inside the iphone. It might be worth replacing because down the road you might wonder why you cant hear anything when people call.
You can change the whole midframe. Its alot easier to do compared to changing just the earpiece. Ive tried to change just the earpiece and havent been successfull. I would suggest buying a midframe from eBay or something and heating the digitizer off the midframe then gluing onto the new midframe.
Greatest innovator of our time. I dont want say hes on the same level because its hard to compare different generations but I dare say he's the Thomas Edison of our time. I'm not saying he invented something as impactfull as lightbulbs, but if there were a close comparison it would be Jobs.