I would wash the fabric - because even some respected "brand named" fabric lines shrink - a lot!
When I've made pillowcases, if I cut on the straight of grain, then I usually did not have too much fraying/raveling.
Also, for pillowcases, I prefer using a French seam - if you make the first seam about 1/4 inch, and then the second seam about 3/8 inch, it's fairly easy to handle.
Otherwise, overcasting or serging the raw edges works.
My Grandma would leave the edges raw. My Mom would make French seams. They both lasted, but the raw edges got ravelly over the years as the pillowcases were washed