1. Increases passive Lust gain.
2. Increases Tease accuracy (caps at 100?)
3. The Fuck Sense perk lets it substitute for Intelligence in Class abilities that rely on Intelligence. Only applies if Libido would be higher. Caps at normal maximum Intelligence. Non-Class Intelligence checks still require Intelligence.
4. Instinctive Psifocus always substitutes it for Willpower in Kineticist abilities. Scales with Max Willpower, caps at 125 Libido.
Lore-wise, wasn't it what killed our dad? They talk of medical advancements in our case, but the impression I got was more "help prevent" rather then "make it not drastically cut short your lifespan should it happen".
Yep, you're completely correct; too much Taint caused age-extending treatments to no longer work on him, and if you hit 100 Taint, the same thing might happen to you too in a few centuries.