I read music, but I think it's possible to understand music theory without reading music. You can know how to build 13th chords and the modes of the melodic minor without knowing where the notes are on the page.
Still, for a guitarrist, it's a good skill to have, and it will set you apart from other guitarrists. Especially if you can sight read well. I focus more on sight reading chords than melody lines, because hey, as a guitarrist, you don't have to read melody lines as often as you'll have to read chords.
As for 80s guitarrists, I personally think that shred is a style of music far overrated by guitarrists. Fast guitar passages do not justify music with little melodic and harmonic content. I'm not saying all shred is like this, I'm just saying that I think that many shred guitarrists use speed as a crutch to hide lack of anything musical that they have to say. "I may not be able to write a melody or chord progression, but I can play really fast, so you want notice." Or: "When I improvise, since I don't have any ability to create interesting lines, I'll just sweep arpeggios at light speed."