Leveling up and progress is necessary only if you start at first/low level, where a primary concern is getting up to the Levels That Don't Suck[1]. If you start at high level, progression can be very-slow-to-non-existent.
In my experience, combat is optional in theory but required for a good game in practice. It's something that can be made to work in read-only fiction, and I've seen it work to include occasional or even regular no-combat sessions in long-running games, but I've never seen combat-free as a steady diet. Glorious violence is just too much fun from the players' POV - including my POV when I'm a player.
Loot is like leveling up. If you start off well-to-do, and aren't on a treadmill where loot is needed to boost oneself up to the Levels That Don't Suck, or where you need burn through lots of moola just to maintain your power level, then loot becomes highly optional or flat out unnecessary. Otherwise, it becomes a must-have.
A need to complete a grand dramatic arc, or to complete a grand goal (get rid of that darn ring, become the High King or grab a shiny from the Iron Crown to fulfill the conditions set by your sweetheart's father, see the threat of the Big Bad Eye brought to a final end) is a matter of taste. Some players (including me as a player) are just fine with a series of episodes and even with slice-of-life (out of an exciting life). Others do want a Story.
A major reason for me to play in a TTRPG is to vicariously experience doing interesting things that I can not, ought not, or dare not do in Real Life. And as a GM, a big part of my enjoyment is world-building and then showing off that world. When I want to create stories, I write read-only fiction.
[1] Many GMs seem to loathe and fear the concept of Levels That Don't Suck, and prefer to either keep players in the sucky levels or else to make the higher levels sucky too.