The O2 sensor is just one of a number of sensors sending signals to the fuel injection system. It can influence the mixture by about 15%, if the system is working "closed loop". The system can work "open loop" with the sensor out of the system. To work open loop the O2 sensor is uncoupled with the engine running.
With the sensor in position it normally produces a small voltage 0.2 to 0.8 Volts. If the voltage is above 0.5V this means that the exhaust gases are low in O2, ie the mixture is rich and the control unit tries to deliver a weaker mixture (within limits).Below 0.5V the converse is true.
As I mentioned above if the sensor is failing it produces a lower current or none, the control unit gets a weak(no) signal and tries to richen(within limits again) the mixture. Hence the heavy gas consumption. If the sensor is taken out of the system this will not happen, but in open loop, the mixture will in any case normally be on the rich side.
In your case I don't know what you did when you altered the mixture, presumably by the mixture screw and whether or not you took the O2 sensor out of the system.