Jeff -

By "block level backup" do you mean a specific backup package or are you utilizing the snapshot capabilities of a SAN/NAS?

There are SAN/NAS solutions that can provide point in time recovery for a SQL Server database (up to the most recent snapshot) and depending on the vendor you may be in good shape with some caveats:

(1) Make sure that the frequency and retention of the snapshots mirrors your recovery needs meaning that if you would normally take a tlog backup of your database every X minutes you need to be taking snapshots with the same frequency.

(2) Make sure that you continue to take & retain a snapshots at an interval that would allow you to recover from a database corruption in a worst case scenario (e.g. daily or weekly). Corruption, the creeping crud, whatever you want to call it happens... snapshots/block level backups will have the same corruption.

(3) Test, test, test. Have your SAN/NAS administrators restore a point in time snapshot to a new LUN/filearea and attempt to attach the database to a different machine... everything that's supposed to be there there?

(4) How is your data being sent off site? Replication to another site or tape? You'd be surprised how many times I've seen SAN/NAS storage not being backed up or sent off site ("but it's a SAN!, we don't need backup!"...) To point #3 above, test a recovery using just the offsite backup... that can get really interesting.

Joe