Left justified. Not fully justified – which is what I think you mean by ‘block’. Fully justified works for magazine & newspaper columns but creates odd line breaks in longer documents.
As long as your application letter is legible, has a font size of at least 10pt, has kerned line spacing or 1.5 line spacing, hits all the right notes, has no typos or egregious grammar errors, and is not in Comic Sans or some other ‘novelty’ font it’ll be OK.
Sans serif will give it a more modern look. Favoured fonts in a recent ‘let’s talk about CVs’ session I was in were Verdana, Tahoma, and Helvetica.
Few people like serif fonts. And sadly, Times New Roman was judged ‘old school’ and worthy of instant rejection. No one raised the idea of Courier 🙂