When a tire is used for a long time, the contact patch tends to flatten out, giving the tire a squared off look.

I'm sure it increases rolling resistance by a good amount, and it probably affects cornering as well. How much, I don't know though, I've never really noticed it but I'm sure it's because I adapted to the feel of my tires as they wore, as it takes too long for a tire to square to produce a noticable change.