If I have a power tool in a wood box do I need a ground?
Any conductive surface which can be touched should be grounded.  The reason for this is that if there were some fault in your device that made a touchable surface "HOT", then a fuse or circuit breaker would blow. So, for your sander, if there is some metal that can be touched, (the screw that holds the sandpaper on?  The center of the sanding disk? the shaft of the motor?),  you should connect it safety ground. If there is really no way to touch a metal surface in your device, I suppose you could not use the safety ground. (You have made it "double insulated")