No, the configuration in line 1 is not mandatory for dot1x. What the command in line 1 does is it means the default authentication for console and line is nothing. You should find (unless the lines or console have an overriding configuration) that when you telnet or ssh to this box then it does not ask for a username or password. You can remove configuration line 1 and it will not have an affect on dot1x.
Simon
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