Think of it like this, your intake system lets fresh air into the engine which is then mixed with fuel and combusted. The resulting exhaust gases are, for the most part, not combustable. So the EGR system takes some of those non-combustable exhaust gases and dumps them into the intake with the oxygen rich, highly combustable incoming air, and in a sense, dilutes the incoming airflow. The result is your incoming airflow is not as combustable and does not burn with as much heat, thereby lowering combustion chamber temperatures.
Furthermore, your computer knows the egr gases are present in the incoming air and the presence of those gases is used in calculating the proper timing and injector pulse for your engine. Therefore if you block off the EGR without telling the ECU via a chip or what not, the ECU will incorrectly calculate fuel curves and timing changes, which will adversely affect your car. Will the affect be noticeable? Maybe, maybe not, but the effect is still there regardless.
For more info, check out this link
http://www.fordscorpio.co.uk/egr.htm
Good luck.