I have blocked/streched a block if it is 1/4" or less off for a 12 1/2" unfinished, anything off more than that I will remake it. It is fine, and long as you quilt sufficiently there is absolutely no distortion and reshrinking once washed. Now if you were to simply ditch around that block and not do any quilting in it then the block could distort and look pretty awful.
Quite honestly, 12" between quilting exceeds the minimum requirements for any batting I have ever seen and battings that say you can quilt up to 10" apart, I would never leave that much space unquilted.