The cam sensor actually is only used to time the fuel injection pulses and possibly to interpret the knock sensor output on pre-DBW cars.
Although the cams are fixed with respect to the crank, for a given position of the crank, the cams can be in two positions since the cams rotate at half the speed of the crank. This is why 2 turns of the crank are needed to bring the cam timing marks back into alignment when changing the cam belt.
The cam sensor tells the engine management which of these 2 possible positions the cam is in, which allows it to work out which of the two possible cylinders is next to fire. Fuel can then be injected into the appropriate intake port (sequential injection).
Since the coil pack fires pairs of spark plugs, cam phase is not important for ignition at all, and no detailed timing information comes from the cam sensor as the crank sensor has greater resolution.
The cam sensor is probably only checked during initial engine start. Once the ECU knows the cam potition it can remain synchronised using only the crank sensor output, which is probably why unplugging it makes no difference.
If the cam sensor has failed the engine management likely falls back to firing the injectors in batches, which actually doesn't make that much difference. The rev limit obviously does, though.
Kevin