The OP said the nitrates shot up when he removed his sump...so it's a pretty good bet that was what caused the losses (sorry about that btw). Sounds like the sump had a DSB and a refugium? So yeah, it's not a big surprise this big a change is going to affect the system.
There are lots of ways to deal w/ nitrates. A refugium w/ macro, vodka dosing, bio-pellets, algae turf scrubbers, deep sand beds (in the display or remote), lots of live rock, etc. Or a combination of things. A variety of methods can work, but it's difficult to switch from one method to another just because most of them take time to start working. So you have to be careful when making major changes like removing a sump from the system.
I personally think a sump is a good idea because it's a convenient place to hide equipment so it's not in the main display. If you're gonna have a sump anyway, why not a refugium? If nothing else, it does seem to be a good place to grow pods.
But no, you definitely don't NEED a refugium. There are very few absolutes in this hobby.