If there is no water leakage problem, but the basement walls are a bit damp, you must cover the walls before insulating. Waterproofing coatings are not really necessary for moisture proofing. Polyethylene plastic sheets or horizontal strips of building paper are sufficient. These should be hung on the wall starting at grade level and extending down right around the bottom of the wall framing. The joint on the bottom should be caulked to prevent air infiltration. Then join the paper or plastic to the plastic air vapour barrier that will be put over the new insulation. The insulation must not be trapped between two sheets of plastic -- that is why the one on the wall only goes as high as ground level and leaves a breathing route through the concrete above it. If it is more convenient for you to hang a plastic sheet from the sill plate at the top of the wall, you can do this if you put holes in the plastic, on that portion of the wall that is above ground level.
If the moisture is very minor it can usually be ignored. If the wall has a history of always being dry, you can ignore this complication all together. However, if this is your first winter in a new house, do not assume it will always be dry. I really don't like finishing interior basement walls before passing one winter and one spring to see how dry it really is.
Should you leave an air space between the wall and the insulation? NO! See Air Spaces in Walls -- Myth and Science.