The vise will hold a dowel without thermoplastic but if you are hammering on your piece or placing pressure on the dowel the hold won't be as strong without the bottom thermoplastic and it will move around.
You can also use square or rectangular pieces of wood, I use dowels because I can easily cut them with a jeweler's saw and I find the round shape easier to work on if I'm resting it against my bench pin.
Secure your dowel in any vise and adjust the angle to find the right position.
You can make a range of heights with different dowels.
The mound of thermoplastic around the piece can be used to support your hands which is more comfortable and gives you greater control.