Not sure about the other issues, but make sure that when you want Powerful Hookset to be used, that you’re also using Precision, otherwise it doesn’t work.
Found that out on another post when searching the forum for something similar.
I’m not sure if it’s related to the update or not, but when I was using Miqo to farm for Moonlight Aethersand three weeks ago, she was workin’ perfectly, proper hooks and ignoring small fish.
You might want to provide a little more detail regarding what you were fishing for, what was caught and what Miqo output as well, so that the team has all of the available information to quickly make tweaks when they are safe enough to do so.