What does the Crankshaft Position Sensor do?
 

I had to replace the Crankshaft Position Sensor last week do to it failing and turning off the engine. But what are all the things that it controls?
I ask this because I have owned my 98 Boxster since last May and it always made a little "rattle" at start-up but since replacing the sensor it's as smooth as silk and runs even better.

The CPS provides the DME with rotational position and rate data for the crankshaft. The DME uses this data for determining how to control fuel (no rotation, fuel pump does not run), spark timing, etc. So the CPS does not control anything, the DME does, but does so in relation to other data (MAF, throttle position, O2 sensors, coolant temp, etc.) to control and optimize the performance of the engine according to the DME's programing algorithm's.

JFP you are tha master

So, could the one that failed have been sending bad info and that is why it now runs better?

CPS does not send 'data'. I provides a reference pulse that is counted and timed by the ECU. The pulse is either present or not.