Joomla still requires it. So if you turn it off CB will try to fill it using whatever Username Fallback you select within CB > Configuration > Registration. By default it falls back to Name, which isn't unique and can result in the issue you're seeing.
You can change the fallback to Email Address though, but if using SEF URLs the username is used there so you'll want to be use Profile Alias field is available so they can change their profile URL. Might be a good idea for us to implement an option for a randomly generated username fallback as well.
forge.joomlapolis.com/issues/8207