Nope.  The first season that I played, I did not purchase any FSS and actually got a couple players that did very well.  Scouting reports provide addiitional information to FSS reports by providing you with "Massive" & "Not Any" potential responses.  As you know, the problem is that scouting trips are too random and expensive to winnow down a long list of recruits.  Unless I had only one open schollie and wanted to target a transfer or international, I would not do that again.

The choice of which to buy depends on your budget, location and number of open schollies.   If your team is on the coast of CA, then you may not want to buy more than CA.   If your campus is in WY, then you probably can afford to buy MT, ID, UT, etc.  One strategy is to search by the mileages around campus.  Buy all states with recruits that you like within 100 or 200 miles and consider going out to 300 (assuming that you can afford it).  Every now and then you can throw in a small state to get the next price break (DC, DE, ID, etc.), just find a recruit that you are curious about.  

Assuming you have been patient with your budget, then you can just buy FSS for a state to get a specific recruit later.   I do that often enough when I miss on my first few local choices.  Just compare the price of scouting that recruit alone vs. the cost of FSS on the whole state.  Remember: once recruits start being signed the price of each state's FSS starts decreasing.  At D3, you could even do nothing until the final day, then buy FSS at big discounts all over the country and not be limited to local recruiting.  So, you can bottom feed, if you will, provided you are patient; it can work.  

There are many other strategies as well, but it is always less expensive to recruit locally.