O2 Sensor, FI LTH & Catalytic Converter questions

Gungrave

So it's been awhile since I posted here, but I have a few questions concerning catalytic converters, O2 sensors and the FI LTH.

I currently have the base model 370 and as for the exhaust, I only have the FI CBE. Earlier today my CEL came on and it's flagging the O2 sensor/s are bad and/or the catalytic converters are bad.

I know it's possible that it's just an error and it's just flagging even though the CC's and the O2 sensors are all working correctly. But on the off chance that either the CCs and/or the O2 are bad, my question comes to mind.

1. Just to confirm, the FI LTH deletes the CCs all together correct?
2. If I had the FI LTH installed, would any of the O2 sensors be used at all? I'm assuming the O2 sensors would still be installed essentially to just fill the holes in the exhaust, but would they actually be in use? And would they all not be in use since there are 4 O2 sensors in total.
3. Would the FI LTH increase or decrease the mileage for the Z or no change in mileage at all?
4. Would the CEL come back on for the O2 sensors again?

The reason why I'm asking is because since my CEL just came on and it's sending the code for the O2 sensor and/or the CC being bad, all 4 sensors cost roughly $1K total and both CCs cost roughly $2K total. Whereas the FI LTH is roughly $2K and would technically be an upgrade and would possibly eliminate the need for O2 sensors and/or CCs down the road.

Thanks.