How to replicate the backpack from Carin? Aka How to get Paper 2D physics to not glitch?

TLDR; Are there plugin alternatives for paper 2D or best practices to keep paper 2D from eating itself when simulating multiple (shrink wrapped) physics objects?

Hey y’all, I have a more general question. I am working on a game and we want to try and replicate backpack inventory from Carin. (Made in Unity) If you don’t know what that is, you can find a small video of someone using the inventory here. (Surprise! It is 2D and physics based) Where Carin treats their backpack as an excellent bit of polish we want to expand upon it and make it a much more central game mechanic. As you can imagine - this makes it very important for the physics simulation to be consistent, predictable, smooth, and relatively bug free.

Based on my research Paper 2D is unreal’s solution for this kind of a situation, particularly for physics simulation. However, after setting up a few prototypes it has been WOEFULLY inadequate to say the least. I imported a few images, created custom collision (think shrink wrapped but with slightly less detail) for them, and constrained them so they collide and simulate on a 2D plane during gameplay. The result has been glitchy physics objects clipping into each other and out of their container. I tried some of the more obvious solutions such as CCD , but so far it is absolutely unworkable.

So I am here to beseech you:

Am I doing something obvious wrong?

Are there settings that can improve functionality?

Are there plugin alternatives/improvements to paper 2D that have already solved the problems I’m facing?

If I have to build a custom solution in the engine I will, but it will take a lot of dev time. If I can save myself and my team that time by taking advantage of existing solutions that would be ideal. Thank you for any advice!