Are intake isolator blocks necessary?
 

I have a 1.7L with carbs and the phenolic block between the head and intake is missing. I installed the thin paper gasket between without sealant and have an intake leak. I am planning to make new gaskets out of thicker material and seal if necessary but am wondering if the spacer is required for insulation or to make a better seal?? Thanks.

fuel boil
 

Hi the isolator is to reduce heat absorption of the fuel in the carbs. The term is also called heat soak.

I made a gasket from thick gasket material and sealed the head side with silicone and no more leaks. I'll do the same for the other side so they are the same.

If you check the parts diagrams you will see what is called the intake gasket but appears very thick and it is what you called the spacer block. It is necessary and used to come with new thin gaskets on each side as they get compressed and warp over time and generally cannot be reused. I would not use sealer on the intake system as it will get hard over time and be nearly impossible to remove possibly and most surely will cause leaks.