Knock Sensor - VT

[Rhin0o8]

Recently found that my car was lagging in performance.
It wants to go but there is definate lull in power from 2nd to 3rd gears ( Automatic )

Its certainly not a coil pack.
Ive used the coil packs out of this VT to run a VS to find/change a faulty one.
all 3 coil packs in the VT are good
new spark plugs put in 2 weeks ago ( About the same time i found the lack in performance.. could this have triggered it?)
Fuel filter is new.
Throttle body has been cleaned

Spark plug leads are due to be changed ( I will check resistance on my stock leads this weekend. im sure they are still good )
Got a code error for Knock Sensor

are these the symptoms of a faulty Knock sensor?
Is it doing damage running the car like this?
Is it something someone in general can replace?

Been quoted $150 to get one fitted. May I do this myself for much cheaper?

any suggestions or experience of this problem from someone else please

[Rhin0o8]

Travelled with a trailer on today, even empty the car was gutless. normally tows trailers real well.

What could be the problem?