If you are not using Internet Exploder for your browser, then no, you do not need it. Removing IE from my computer is one of the first things I do after an OS installation.
If you are using IE for your browser, then yes you need to keep up with the latest version as it always has things in it malware/spyware/viruses like to attack.
All that said, if the installation is failing, then you need to find out why. It points to something else being very wrong with your computer.