The crank position sensor, reference sensor - whatever it's variously called located at the left rear of the block that reacts to the flywheel segments is the one that is part of the ignition system.

The TDC sensor at the front of the engine serves no purpose whatsoever for engine operation. The lead terminates at the diagnostic socket. Its signal is purely for some piece of test equipment. I suspect that since it provides a TDC signal it is a reference so the test set can read out spark advance.

Any permanent magnetic device that provides a voltage signal will slowly lose magnetic flux over its life and eventually will not generate enough voltage to operate the system, so even if the sensor doesn't fail in some way, it will eventually effectively "wear out" electrically.

I recall from reading service information that there is a voltage spec range at a given engine speed, and if the sensor doesn't generate voltage within that range it should be replaced. One would need a sensitive inductive pickup to read the voltage signal as I recall it is not more than a few volts.

Duke