There is one relatively simple way of preventing penalty fares being
incorrectly applied, but you won't like it - auto top-up.

Doesn't stop the timeouts or incorrect charging, but your balance
won't drop below £5 so it isn't going to attract a PF.

I've said before that I find Oyster reliable for the journeys I make
when in London, but I guess I don't trust it enough to risk a balance
close to zero.