It’s not quite like that. The time knob sets the delay time per step while the sequencer is in recording mode. In playback mode, it’s indeed used to change the tempo. There are no note lengths in the sequencer: It only changes the pitch (and delay time) per step. You still need to trigger the voices yourself by using the pads or putting them in drone mode. This allows for a lot of flexibility and interesting patterns. Like you could record a sequence for all 3 voices, then when playing back, put only one of them in drone mode and alternate triggering the other 2 one by one.
The question of discarding one knob or switch input is not so much about when you might not need its functionality (e.g. during sequencer playback), but rather a hardware one. You cannot simply feed both the sync input and time knob input into the microcontroller on the same IO port and discard the one you don’t need. You’d need 2 IO ports for that, and there are no free ones. So you either need a multiplexer chip, or sacrifice some other functionality permanently.
Well, okay, that’s not 100% correct either. You could forego the multiplexer and install an additional switch that lets you select between sync input and time knob manually. Then you’d only need a way to tell the microcontroller which kind of information is currently being received on this IO port. So, again, you’d need another free port to tell it that. Or you could implement some kind of heuristic that decides whether it’s a knob being turned or a sync signal. Which should be fairly easy, but it all seems a bit hackish.