question

First of all: why are you creating your own reporting database, instead of SSRS? Or are you intending to create a database which will be used for your reports? If so, create a denormalized database, because that's much easier and faster to use. Since it's not being used for online operations you don't have to worry about duplicates and other normalization rules. And the data in such databases can be reconstructed (by a process which fills this databases). A general rule: OLTP databases need to be normalized, a "BI" database not.

To a degree, this comes down to defining what you mean by relational. If you mean a Codd-defined Third Normal Form database, no, it doesn't have to be relational in that fashion for reporting. In fact, depending on your reports, that form could be more problematic for reporting (it could also work just fine). But there are other types of data designs that are absolutely relational, but not in the Third Normal Form style. Lots of people will build a star schema for their reporting systems. This is a very different structure from the traditional OLTP normalized database, but it's still very much a relational storage mechanism. And, it's absolutely designed around reporting. In general, I'd say yes, you should have either a normalized structure or a star schema for most systems.