I am planning on painting the hood of my car. A friend told me I need to wet sand it first. Is this true? And if so, would something like this do a good job?

http://www.autobodytoolmart.com/p-12829-15974.aspx

You wet sand the new paint after you spray it, not before. Wet-sanding floats the dust away & lubes the paper as you sand any orange peel out of the job. You dry-sand the original hood. I'd offer more if I knew the specific condition of the hood you're starting with, such as : feather-edging, increasingly fine grades of paper, sanding blocks, wax & grease remover, tack rags, etc.

I wouldn't bother with the $21 sanding block/hose- I sense the hose itself would be a constant source of annoyance, refusing to completely uncoil and getting numerous air bubbles in it. You can use a dollar-store spray bottle or a large sponge much easier and much cheaper. A basic block like the link shows, without the hose, is a good ergonomic block to use, however.