Buying this machine is a good investment (in my opinion) because it does so much and you are not locked into only cutting fabric. It is a good all-purpose crafting machine.
Yes, it will cut appliques and allow for the 1/4" seam allowance by changing the settings. I have:
cut my iron-on stabilizer the shape of my applique with the scan n cut,
then ironed the stabilizer pieces to the fabric,
scanned the fabric with the ironed-on stabilizer,
cut the fabric with 1/4" seam allowance around the stabilizer using the machine,
then pressed under the seam allowance,
then sewn the applique with a very small zigzag stitch to give the look of needle-turn.
I have also just ironed on the stabilizer to the fabric then cut the appliques for the raw edge application.
There is a learning curve but it is not difficult to use (I took only one class).
For cutting numerous quilt block pieces I, personally, prefer the AccuQuilt die cutting machine or the good old rotary cutting method.
Hope this info is helpful in your decision.