Griff had a slab fracture on one of his molars. He did it 3 months after I adopted him in 2008. The big one in the back, of course, with three roots. It cost a little over $700 to extract the tooth (this was 6 years ago). He hasn't had any issues with missing a molar.
If not pulled or treated, slab fractures will abscess and cause an infection that could transfer into the bones. That can sometimes be fatal, and abscesses are extremely painful. I would go with your vet's advice. A dog can function just fine with a missing tooth, but an abscess and bone infection or systemic infection is going to be far more expensive to treat and could result in a dead dog.
Talk to your vet about sealants vs. extraction. My vet did not feel sealants were an option for Griff. He had split the molar from the bottom of the tooth all the way up underneath the gumline. That sucker was fractured... this dog doesn't do anything halfway. He was 3 years old when he did it and had the tooth pulled, and he is 9 now. The vet should evaluate the dog and the fracture (how severe it is) and give you treatment options. Do get a second opinion if what your first vet said doesn't sit right with you.
Do get your dog some painkillers from the vet if you go with the extraction. Griff had to be on soft food for a while, so I made him a mash of boiled chicken, rice, sweet potato, and kibble that had been thoroughly softened with water.