Hello @Alen Rokic , thanks for your interest of the Azure Managed Grafana product!
For the above describe scenario, it is not "required" to have the "Monitoring Reader" role over the whole subscription.
The "Monitoring Reader" role is being used for the Azure Managed Grafana's system assigned managed identity to read Azure Platform metrics, Azure Platform Logs and Azure Resource Graph. By having the "Monitoring Reader" role on the whole subscription, then the Azure Managed Grafana would be able to access all the resources' data without any extra manual effort. If you only want to access the data on a subset of resources in the subscription, doing manual role assignment on demand will definitely work.