If the circuit doesn't require a grounded conductor, then there is no connection made to the laod side neutral on the GFCI. The line side neutral must be connected to the panel neutral buss. The GFCI will work just fine on this two wire circuit. It monitiors the current on the two hots and the neutral, and as long as this sums to 0 there is no ground fault. When some of the current returns by a path other than the two hots in your two wire circuit, the sum will no longer be 0. The GFCI will trip when this sum exceeds 4 to 6mA. The same thing happens on a three wire circuit. Under normal conditions, the sum of the three currents is 0.