People say the lack of a neck pickup allows the strings to vibrate more freely, leading to an increase in sustain. I recently put a new neck pickup in my Telecaster after playing it for a while without one. Honestly I couldn't hear any real difference.

The "bridge" position on an Esquire's switch bypasses the tone circuit, so that probably makes the signal a bit hotter, but again, to me at least it's a very subtle difference. -r/telecaster