I've been thinking about removing the cat on my 91 1.8 190e to try and get a bit more torque out of the engine and also because I thought it was rattling.
I've not done anything in the end but the conclusions I came to were:
The cat acts as a silencer.
Cat bypass pipes can be easily made.
The power output will probably change very slightly perhaps 1%, the engine could be tuned leaner without a cat to get a bit more power.
No changes would be needed to the sensors.
I think the best course of action would be to get a silencer made up that will fit where the cat goes. Then you would have the advantages of better flow without increasing the noise too much.
Perhaps having something custom made would be easier than searching for a replacement part as even where you are people should have access to steel tube and sheet etc.