Yes, the wax can spread. You don't want it to spread into the throat of the flange, but other than that, no biggie. But, because the wax isn't resilient, you do need something to keep it from rocking. Personally, I usually make do with a penny, dime, or a nickel, giving me three different thickness items that I don't have to go to the store for. FWIW, a toilet normally won't leak until there's a backup in the pipe (waste, at least). Now, sewer gas, there won't be much, but if there's a gap, some will.