600 pulses / revolution at 300 revolutions / minute times 60 seconds/minute = 3000 pulses per second.
Generally an encoder pulse is 50% on/ 50% off. For there to be 3000 pulses per second, each pulse would have to be on for 1/6000 seconds (.167 milliseconds).
Since the 1734-IB8 has a minimum 0.500 ms hardware delay built into its circuitry, it is inappropriate for this application just because of the hardware.
The I/O update for the logic controller is the principal limitation to using a general-purpose I/O module for fast signals like an encoder. In general you need an I/O update twice as fast as the expected signal.
A default 10 millisecond I/O update will allow you to sense pulses 20 milliseconds long. You have to sense both ON and OFF states, so the fastest signal you could reliably detect is 1 / 0.040 ms = 25 Hz.
All this is a long-winded way of saying "yes, you should use an encoder module".
The POINT I/O platform has two different kinds of encoder module; the IJ/IK and the VHSC.
The 1734-IJ and 1734-IK are the "encoder" input modules, and are good for measuring speed or frequency. The -IJ is for 5V inputs, the -IK is for 24V inputs.
The 1734-VHSC5 and VHSC24 are the "high speed counter" modules which are good for counting pulses and turning on local outputs based on those pulse counts.