I wouldn't say it retards it for low octane... in the sense that it detunes itself so it is safe to run a lower grade. More like it goes into a "safe mode" due to spark knock. But... you're confusing ignition timing with valve timing. When you get those codes, what it is telling you is that your camshafts are not correctly sequenced (timed) to your crankshaft. It really doesn't have anything to do with ignition timing (although your computer my very well pull ignition timing for safety sake or depending what's going on, just because it thinks the engine's rotation is in a different spot than it really is). I believe your ignition pulls it's timing from the crank position sensor. The thing is, if your crank position sensor is readin incorrectly, your ignition timing will be off; this could explain the sluggishness.
I doubt your can of mechanic in a bottle caused the problem. But I'd stay away from that junk from now on.
Either way, I wouldn't ignore those codes; crank and cam position sensors very rather important and if they are not reading correctly, or are erratic, it could cause you further... more expensive problems.