I do not know if you can mod your way around it.
There is no way. The cap is hardcoded.
If I recall correctly, I think the sensor cap was put in place due to resolution and lag problems on older machines when a large part of the map could be seen.
True, but it is also still the case on newer machines. Especially if you play on Gigantic or Immense maps with thousands of ships. Having to render and move all of those ships can reduce the fps, and increase the time a turn takes, by a considerable amount. Maybe it isn't so bad, if you have really high-end hardware, but I still notice it.