Cinder block walls basically have no horizontal strength, even when mortared unless they have a load on top. This is why most contractors will not backfill around a foundation until some of the structure is built on top. In one case I know of, a house was completely built and the foundation was backfilled with sand. Hydraulic pressure built in the sand backfill and all the basement walls collapsed but pyramids at the corners. As Rad said, you can improve the strength by coring the blocks with concrete. Typically rebar is also added to the cored holes. The dirt backfill is going to put a lot of lateral pressure on the blocks especially if you compact it for a stable base for the pavers. There is no footer so the wall will not be stable from vertical or horizontal movement at the bottom eventually causing it to crack. A reinforced concrete footer tied into the cored block wall would be much better. You could possibly dig deeper burying the bottom block and a half instead of the footer but I've never seen this done. This method's costs would likely exceed that of purpose built retaining wall blocks. Retaining wall blocks could also be reused for a future project.
