You don't even need to play CoM to understand what's going on and what went on between KH1 and KH2. If you've played Sora's story, then that should defenately be enough -- you can always read up a script on the rest if you feel you really need to.

But in anycase, there's not much story in Rebirth Mode anyways.

I say go Proud mode, if you stick around low levels it can be a bit of a challenge. But always look out for places you can level, if you're five levels higher than the world, then it becomes a lot more fun.

Plus, Jiminy's Journal is apparently very annoying to get %100 (which is what you need on Normal mode to get the secret ending). So yeah, Proud is defenately worth it!