Running Macbook with 7.3v battery & AC power adapter
If the apps are freezing then the Mac is trying to use the battery for power and failing.
Most (if not all) portable Macs use both AC and battery for short periods (like opening apps). A bad battery can cause crashes and data loss as the Mac tries to use the battery and cannot.
The CPU throttles without the battery because the Mac sees the missing battery and lowers power use. Your Mac has freezes because you exceed the AC adapter slightly. I assume a larger power demand will cause a crash.
At the very least the battery can swell and bend the Mac, and can sometimes catch fire if the defective cell cannot turn off. It would be safer to remove the battery and use on AC.
With only 3 cycles the battery looks like it was constantly full for 8 years (non-retina device) so it is time for a fresh battery. Batteries need to be used occasionally.