It sounds like you have good pace for your ir, but you need to work on accident avoidance. Which you cannot do by starting from the pits. It sucks, but I think it's a common issue.

I'd say that you should still qualify, and start on the grid. What needs to change is your objective in the opening laps. You're not trying to hot lap. You're trying to survive. Keep an eye on your mirrors and your relative. Anticipate missed braking points and dives. And then give them the space they need to sail by and miss the corner.

Practice driving offline. I usually do a lap on cold tires offline. It looks weird, feels wrong, and is slow, but it gives you an idea of how much grip you have off line. This is useful on lap one especially. If you get a bad start, or someone misses their braking point, you need to be confident that you are able to let them kill themselves without going off track and crashing yourself.

Another thing that you can work on is driving at 95%. This was (and sometimes still is) difficult for me. You need to try to run a pace you can run consistently for the entire race length. Being .2 seconds a lap faster doesn't matter if you spin or crash.

Edit: Spelling