Do I still need to use virtual memory?

See Mark Russinovich's article on Virtual Memory. That should give you a good pointer about Virtual Memory.

Here's a useful excerpt from the link

So how do you know how much commit charge your workloads require? You might have noticed in the screenshots that Windows tracks that number and Process Explorer shows it: Peak Commit Charge. To optimally size your paging file you should start all the applications you run at the same time, load typical data sets, and then note the commit charge peak (or look at this value after a period of time where you know maximum load was attained). Set the paging file minimum to be that value minus the amount of RAM in your system (if the value is negative, pick a minimum size to permit the kind of crash dump you are configured for). If you want to have some breathing room for potentially large commit demands, set the maximum to double that number.

Since memory is not exactly a sparse resource on desktop PCs / laptops anymore, I doubt that most programs can handle out-of-memory conditions gracefully and will crash instead.
So: Dangerous? Yes, if your 4GB are used up somehow and you have no pagefile, applications may start to crash.
And as shown in Zoran's example it may be hard to identify the problem later on.

The article, that Ram refers to, also states, that turning swapping off usually doesn't improve speed and may do the opposite instead:

So while there may be some workloads that perform better with no paging file, in general having one will mean more usable memory being available to the system

I'd recommend to leave the virtual memory settings to their default. I have 8GB of RAM and turned virtual memory off thinking I would gain in speed (because of no swapping), but it turns out that made my system less stable (and I did this on 2 machines, similar result). I was experiencing one BSOD per week approximately, on both machines. I started examining the minidumps produced and found out that all the BSODs were triggered by a call to a routine called KiPageFault. So I tried setting the virtual memory settings back to their defaults, and the regular BSODs disappeared.

Took me quite a while to correlate the 2, and I have no actual evidence that the fact that I turned off virtual memory caused the BSODs, but my machines were more stable after I turned it back on...