Those wires absolutely matter. On a folding drone that arm is basially a conduit, the motor wiring runs through the hinge area back to the main board, so what you're seeing is almost certainly the motor leads plus a thinner bundle for signals. They're not there for the fold mechanism, they're there because the hinge is the only path from body to arm. Which is also why a crack in that spot is worse than a crack anywhere else on the shell.
I cracked the same area on mine after it tipped over on launch from gravel. Powered up fine, flew fine for a couple of test hovers, so I get why it feels like no big deal. But the first thing I'd do is look closely at those wires where the housing broke. If the insulation is nicked or you see copper, stop flying it, a short there will kill a motor in the air and there's nothing you can do about it at that point. If the insulation looks intact you're probaly okay electrically. The latch is the bigger worry though. If it doesn't snap positive anymore, that arm can fold under motor torque mid flight, and when an arm folds it's not a slow failure, the drone flips instantly and you lose it. Tape does nothing for latch tension. Mine held up because the crack didn't touch the locking tab, but yours sounds like it might have, since you say it feels less snappy. What I'd do is pull the shell section off if it's just a few screws and see whether the crack is cosmetic or structural. Plastic epoxy works better than superglue for this stuff, superglue goes brittle and cracks again on the next landing. If the tab itself is broken, replacement arm sections are ussually cheap and the swap is genuinely easy on most models, a couple of connectors and screws. If you do fly it before fixing it properly, keep it low over grass, gentle inputs, and land and recheck the latch every battery. I wouldn't take it anywhere near water or over anything you can't afford to lose it over until that hinge is sorted.