Have not actually tried it myself, but I did dredge up that exact setup last year off the bottom. The day before I saw a Ted's employee fishing the same spot.Could it have been his???
I personally don't think unmolested steelhead are that picky, so I don't know why it wouldn't work. On the other hand, if they are not biting, show em something different.
By the way, the set up I found was big. Big rag, 6 or 7 in. worm.