An intensity modulated fiber-optic position sensor, based on a fiber-to-bundle coupling and a readout system using a CMOS image camera together with fast routines for position extraction and calibration, is presented and analyzed. The proposed system eliminates alignment issues otherwise associated with coupling-based fiber-optic sensors, still keeping the sensing point free from detector electronics. In this study the robustness of the system is characterized through simulations of the system performance, and the outcome is compared with experimental results. It is shown that knowledge of the shape of the coupled power distribution is the single most important factor for high performance of the system. Further it is experimentally shown that the position extraction error can be improved down to the theoretical limit by employing a modulation function model well fitted to the real coupled power distribution.