It does not hamper performance, if anything it improves it. Technically, you CAN remove it, but it will leave a big hole in your block, and on top of that it would be pointless to remove it.
As far as what it does...inside the crankcase, gases build up due to the combustion that gets past the rings (And yes, in every single motor some combustion gets past the rings), the heat, and the oil in the crankcase. These gases cause the buildup of sludge, and also cause excess pressure inside the crankcase. The PCV system (Positive Crankcase Ventilation) pulls the gases from the crankcase back into the intake manifold (and thus into the combustion chamber) and burns them along with the air/fuel mixture.
I would never, never, ever get rid of the PCV system.
On another note, I've heard of some 'hardcore' racers getting rid of the PCV valve and just running a hose straight from the PCV box to the intake manifold. This is an even worse idea than removing the entire PCV system, because the PCV valve acts as a one-way check valve so that gases can escape the crankcase, but nothing can get in. I have seen, in person, a muscle car backfire through the intake manifold and ignite the gases in the crankcase (Because of the lack of a PCV valve) and literally blow the oilpan off of the motor.
cliffsnotes: leave it on. It doesn't hurt performance at all.