So in response to your question, Yes in order for the Slingbox to work, the Set Top Box will need to be on. The great part, is that you do not need to leave your Set Top box on at all times because, the virtual remote will control your Set Top Box fully. It will allow you to turn on your Set Top Box when you want to watch your TV/Slingbox. Also can turn off the Set Top Box when you are finished watching. You can do this remotely. I would advise to test everything with the virtual remote control to make sure it is working correctly for you.
Hope this helps!
Sling Media Support Team,