If this were a list View permissions would be fine. But even to view an
Excel file in a browser you need to download the file to temporary storage
on your workstation. That requires Read access to read the file. View only
lets you view the metadata. So for lists View and Read are pretty much the
same, but for Libraries View will let you read the metadata on the file, but
Read is required to actually read the file.

You should also be aware that if you read a file (download it to your
workstation) you can then edit that file. Of course you would need edit
permission to put it back, but you can always edit the copy you made. To
prevent that you need a rights management server.

...unless you are running SP2010 with the Office Web Applications, in which case
View Only will allow the user to view the document in the browser but not edit
or download.

I am running SP2010 with OWA. View Only gives an access denied error. Same
thing in the log files.