Hi Sagar,
I have tried to clarify your 3 points as below
1> does input parameter needs to be always entered?
Ans : Yes, if it is marked mandatory in setting
2> use of variables is a NO because we are using huge data to query.
Ans : Input parameter and Variable is used in different scenario, it has nothing to do with Data volume.
3> Cannot have the option to make both the fields mandt.
Ans : You shhould have that option to make both field Mandt