The question is if we don't upgrade them will they check into the SEPM once its upgraded from 11 to 12?
If nothing else changes (i.e. SEPM is upgraded, not uninstalled and reinstalled with new communication certificate, etc.), yes.
And if so, is there a way to block them from being able too?
You could probably move them all to a new group, block clients from joining the group, then delete them from the client list.
Blocking clients from being added to groups
http://www.symantec.com/docs/HOWTO54730
You could also make them unmanaged, as noted above.
sandra