'Bottom Baits' as you refer to them are not fished strictly on the bottom, with maybe the exception of a football or shakey head jig. The majority of the time they are targeting the same fish your drop shot is unless you fish that drop shot directly under the boat, or with a long leader. My point is; you are basically fishing a different version of a 'Bottom Bait' without knowing it. Jigs, T-rigs, Tubes, C-rigs although sometimes fished on the bottom are often most productive when the bait is falling. Sometimes it is the initial drop to the bottom while other times it occurs as the bait re-settles after rising during the retrieve.
You favorite, the drop shot, when cast isn't very far off the bottom even with a two foot leader to the weight because of the angle.
The advantage the drop shot has, at times, is its ability to stay off the bottom the entire retrieve.
You will find that a T-rigged curly tail worm cast out and allowed to sink to the bottom and then brought back with a steady retrieve will out produce a drop shot under most conditions mainly because you will be covering more water and presenting it to potentially more fish. The same can be said for most bottom baits, so give them a go next time your drop shot is getting hammered (when you know you're on fish and they're active).
As for hook-sets, my rule of thumb is; If the hook is burried in the plastic, I reel down taking out any slack to about the 5:00 position and then quickly straight up to 11:00-12:00 while turning the reel handle. If the hook is outside the plastic, either resting on top or skin hooked, I'll use more of a reel and sweep the rod style of hook set. Hope this helps.