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What exactly do you mean by crime? You mean your bounty? Your bounty has to be paid off and will increase depending on what you do. There are (surprisingly) different bounty levels and with each level the guards will react to you differently. There are 3 levels each of which start at a certain bounty price. 1st level - guards will recognize you as a criminal ONLY if you talk to them. 2nd level - guards will run up to you and attempt to put you behind bars. 3rd level - guards attack you on sight.
Crime doesn't really do anything, it just allows you to experience the game if you were "bad". It sets the moral standards, like "I know stealing is bad, therefore I won't do it" etc. However, there is an achievement based on crime and bounty. Sometimes npcs will have expensive items in their inventories, or it might be quest related. In the case of the Dark Brotherhood, most quest relies on crime, specifically the contracts.. Because you wouldn't want to be caught killing your target.
TL:DR :
No the choices you make do not affect the overall story, but rather they give you choices to how you want the outcomes to be. eg. If you kill a person instead of sparing them, they won't be availiable in the game anymore.
Crime is just a feature to make the game more immersive and realistic and gives you an understanding of what should or shouldn't be done.