As your oxygen sensor is going bad you may notice your vehicle is running rough, misfiring or running irregularly while idling. You may also observe other engine performance problems, such as loss of power, hesitation, or stalling.
What happens if you remove downstream O2 sensor?
With the O2 sensor removed, your ECU can no longer calculate how much fuel should be injected. The ECU will fallback to its default value and always inject the same amount of fuel every time. This could cause either low performance or horrible fuel economy.
Do downstream O2 sensors affect performance?
2. That O2 sensor is bad. Like others have said, a bad downstream O2 will not have any effects on performance/MPGs, but you are right that a bad catalytic converter may.