Originally Posted by hokiefyd

It sounds like your old Trek had a quill stem which, as you stated above, is adjustable for height by loosening the quill bolt. On these, the headset is totally separate from the stem and relies on threads on the fork's steer tube to set and maintain preload on the bearings (and to hold the whole thing together in general). The quill stem is entirely separate to the headset and can be removed completely without touching the headset.

Your Cannondale has a variation of a threadless stem, wherein the steer tube is not threaded and the stem slides down around the steer tube and clamps around it. On these, you set the preload of the system first with the center bolt, and then clamp the stem. From that point, you could actually remove that center bolt (as it sounds like you may have done) without upsetting the headset's preload...but you also can't do anything with the stem unless you take the whole system apart.

(I said variation above because I don't know what modifications or non-standard components Cannondale used in its Headshock design...regardless, the basic headset principle remains.)