N2 is (mostly) inert when it comes to respiration. What your body needs is oxygen and low concentrations of anything that might also be metabolically active. For scuba diving, N2 is used to dilute the oxygen and is used specifically because of how non-reactive it is. At high concentrations though, it can result in nitrogen narcosis - helium is sometimes used as the diluent gas instead to mitigate this.

As far as habitability is concerned, atmospheric nitrogen is essential for life on Earth at least, as it's a major part of the nitrogen cycle (specifically, nitrogen fixation). Without it, we wouldn't have nitrogen-containing organic compounds like amino acids (and, therefore, proteins), at least not nearly in the same quantities that we currently do. This doesn't mean it's essential for life outside earth, but it is for life as we know it, so its presence should increase our credence (if only a little) for whether a given planet is habitable or not. However, when looking for signs of life, it's better to look for atmospheric signatures that are heavily influenced by life, rather than just those that facilitate it. The oxygen in Earth's atmosphere was largely produced by life, and so its presence in the atmospheres of other planets would be a good (though not definitive) indication of habitability.