It's not so clear whether the function of kiddush levanah is meant to be a praise for the existence of the moon, or more similar to a birkas hanehenin (like the brachos on food), that we can't benefit from anything without first making a beracha, including moonlight.
Regarding whether or not one has to see the moon: as the Biur Halakha points out, that if the bracha is a birkas hanehenin, then like all birkos hanehenin, one needs to get some benefit from the object of the bracha. According to the Mishna Berurah there (426:3), one does indeed need to get benefit from the moon before making the bracha, which he defines as being able to recognize the moon's light on the ground.
The relationship of kiddush levanah to benefiting from moonlight doesn't necessarily mean that one needs to see the moon. The Mishna Berurah also writes (426:1) that a blind person must make kiddush levanah because he benefits from the moonlight via other people who can see and help him. In addition (M.B. 426:3) if there are clouds covering the moon, kiddush levanah can still be made as long as the moon's light shines through enough that it's useful as moonlight. If not, however, the bracha can't be made, because then nobody (around you) is benefiting from the moonlight.