I see Redcliff being brought up quite a bit with Connor and Isolde as a reason to maintain the status quo (or continued crackdowns.) But doesn't that actually work against the argument. I mean what was the reason for Isolde hiding Connor's manifested magic ability? She didn't want the Templars to take her child away. (It's been awhile for DAO so maybe I'm misremembering.) Therefore wouldn't a modified system of more interaction that doesn't automatically severe family ties eliminate (reduce) that type of thing from occurring? Just saying.
The gist of the Redcliffe incident was that a small, lone child did all that damage.
How and why are not really relevant given that they can differ. A similar scenario could have played in another place, with different circumstances, but same results.
An over-bearing mother may hesitate to give away her child even under a far more open system.
Both Isolde and Connor may have different reasons for did what they did, or different "triggers".
Would have Isolde given up Connor under different circumstances? Maybe. Maybe not.
Any containment system is a balance between security and freedom. You cannot increase one without decreasing the other
Again I need to bring up the potential results of the current state of things with war/rebellion. When I think of war I think of tens of thousands if not hundreds of thousands dead. If you have a system that ultimately results in war what have you successfully accomplished? The Circle system exists to protect civilians from rampaging mages (and vice versa,) yet that system has manifested a war that will ultimately kill (or destroy the lives) of untold civilians. Any benefit you may have incurred by the system may have ultimately been negated by the end result.
The mage-templar war is not an actual large war. Mages are a tiny minority and are fighting the templars. So the armies in question are both rather small, thus hundreds of thousands of dead are unlikely, especially given that this isn't a conventional war of land grabbing, hence why civilians are of no interest to any group.
B.t.w. - ANY system is doomed to fail eventually. Any restriction places on someone will eventually result in resistance to it. Such things are cyclical, like the seasons.
The Circle system has stood for longer than democracy existed in RL.
I'd say that a good track record.