dirnt83

This is the most important part of the game! The Prince just killed Kaileena, thereby creating the sands and dooming himself. At this point he finds out that he can have a second chance by becoming the wraith.

The wraith mask lets the wearer execute a paradox in the timeline by killing their former self. Only when this happens does the wraith mask loosen and the wearer returns to their previous state. So if the prince puts on the mask, he can stop himself from killing Kaileena and get another chance to enact his new plan...

...which is to drag her into the future and kill her there, so that the sands won't be created until after the storyline in "Sands of Time" occurred. In that case, he couldn't have released the sands and couldn't have fumbled with the timeline, which is why the Dahaka was after him in the first place.

In other words, the mask of the wraith is a plot device that allowed the writers to develop some risky and otherwise questionable paradoxes without losing credibility.

For more info on time paradoxes, watch the Back to the Future trilogy.