I have been fishing out of Northern California for the past three years with a very high catch rate. In addition to circle only, they also had to be barbless. Like the others said wait for the bite and apply steady pressure, no drastic hook-set.

As for making large holes in the bait, I always used an anchovie threader so only the line was through the bait and the hook remains exposed, or you can tuck it back in the bait.