the original wiring in PKDM baleno has the trim pot for adjusting the AFR, but in the JDM version the AFR is controlled with Oxygen sensor.
If the PKDM version wiring is done then there must a trimpot, if installed and working then u can skip the O2 sensor.
But if there is no trim pot installed in working condition then u shud go for activating the O2 sensor as it provide almost real time data to ECU and better for fuel economy,
and yes u will be needing a Cat conv for proper working for o2 sensor.
the EVAP system traps the fuel vapour and feeds it into system, so in a way it also helps improve fuel economy.
so if u can then get it installed properly.
best way is to wire it up according the schematics and verify through attaching scanner