I'm no pro, but I don't know of any reason why you wouldn't sand the car before painting it.
I've probably seen 100+ suggestions of things that can be done to improve the speed of a pinewood derby car. I've never heard anyone suggest that rounding the sides will improve speed. I'm sure someone has an opinion, but a detail that minute is probably only going to make an impact at the very highest level. It's not going to matter for someone that's considering painting a car without sanding it.