Hashim,
To address your basic question: Should the use of TC bolts be prohibited on structures supporting fatigue or load reversals? I think the answer is No. I will now provide some rationale for my response. I will break the discussion into three parts.
1. Prohibiting TC bolts does nothing to address the problem.
The RCSC Specification lists four pretensioning methods: Turn-of-Nut Pretensioning, Calibrated Wrench Pretensioning, Twist-Off-Type Tension-Control Bolt Pretensioning, and Direct-Tension-Indicator Pretensioning.
There are procedures that must be followed to ensure that each method produces a properly pretensioned joint. If the joints are not being properly pretensioned, then the procedures are not being followed. A prohibition on TC bolts does not address this underlying problem. It is just as likely (and in some cases more likely) that the procedures may also not be adhered to relative to another method. Many engineers consider Turn-of-Nut Pretensioning the "gold standard". Arguments can be made that there are fewer variables involved with Turn-of-Nut Pretensioning making it more reliable. However, assuming one of the issues you are seeing is a lack of firm contact between the plies before pretensioning, this is just as likely to happen with Turn-of-Nut Pretensioning. Even when match-marking is performed, if the initial mark is placed before the plies are in firm contact, then some of the turns will be used to establish firm contact instead of to achieve the proper pretension. Problems with "cross talk" or improper tightening sequence can occur with all of the tensioning methods.
2. The $1 Test
This brings us to a second issue your $1 test, which may be giving less than one-dollar's worth of insight into the pretension in the joint. RCSC defines firm contact as, "The condition that exists on a faying surface when the plies are solidly seated against each other, but not necessarily in continuous contact." All of the pretensioning methods start with a snug-tight condition defined as, "A joint in which the bolts have been installed in accordance with Section 8.1. The snug tightened condition is the tightness that is attained with a few impacts of an impact wrench or the full effort of an ironworker using an ordinary spud wrench to bring the plies into firm contact." Firm contact does not mean continuous contact. As stated in the Commentary, "However, in some joints in thick material or in material with large burrs, it may not be possible to reach continuous contact throughout the faying surface area as is commonly achieved in joints of thinner plates. This is generally not detrimental to the performance of the joint." Non-continuous, but firm, contact is not detrimental to achieving and sustaining pretension or to providing slip resistance. I know that there are joints in service that I have designed with oversized holes supporting about 30-stories of high-rise building where I am certain I could easily insert a crisp $1 or even a nickel in places. It does not keep me from getting a good sleep at night.
3. A path forward
Franz Kafka once said, "In the fight between yourself and the world, back the world." I am not completely sure what he intended since it was written without context, but I like to apply it to engineering. You have stated a problem. Setting aside my doubts about the conclusiveness of the $1 test, if you can easily turn a nut on a bolt with a wrench, then the joint is not properly pretensioned. No amount of quoting from codes or numbers from technical models can eliminate a physical reality.
I have asserted under Item 1 that prohibiting TC bolts does nothing to address the problem. I believe this is accurate. Using F3125 Grade A325 or A490 bolts will eliminate the issues related to Twist-Off-Type Tension-Control Bolt Pretensioning, but these issues will simply be replaced with other issues. None of the methods are foolproof.
So what can be done? You have indicated that problem may be associated with quality control. This is a possibility, and in my opinion a likely cause. Returning to my example of the high-rise building with the oversize holes, oversized holes were used to provide more tolerance on fit-up during erection. An exchange was made, fewer bolts would have been required and the bolt installation would have been much simpler, if bearing bolts in standard holes were used, but it was decided that the additional hole clearance was worth the expense associated with more bolts to be installed using a more complex method. Having made this choice, extra care was dedicated to ensuring that the faying surfaces were properly prepared and maintained and that the bolts were properly pretensioned. In other words, "There ain't no free lunch."
The biggest problem I see with slip-critical or pretensioned joints is the over-specifying of these conditions. The vast majority of joints used in structural steel buildings can be installed snug-tight. Snug-tight installation is quick, easy and economical. A snug-tight, bearing joint is virtually foolproof; there is little that can go wrong. My advice to engineers is that they should allow snug-tight installation wherever possible and then dedicate extra care and attention to those relatively few joints that must be slip-critical or pretensioned. In fact your discussion seems to indicate that you may actually be applying unnecessary requirements to your projects, potentially drawing attention and resources away from critical joints. You state, "Although those situations were corrected, and thankfully only demand light static service, those things I should not have seen if the connection was properly installed." If the demand was only "light static service" then as long as the requirements for a snug-tight joint were satisfied the "the connection was properly installed". There was no need for any remediation. By specifying these joints as pretensioned, you are pulling ironworkers' and inspectors' attention and time towards joints where these issues are of little consequence and potentially away from joints where these issues are of great consequence. This is a poor use of resources.
Tables N5.6-1 through 3 provide the QC and QA task that must be performed to ensure proper bolting. You should ensure that the contractors and the inspectors working on your projects are aware of these requirements and conform to them.
I will also address a related issue, and that is loosening. AISC and RCSC take the position that a properly pretensioned joint will not loosen. I have seen nothing that leads me to believe this position is incorrect. However, some engineers involved with industrial structures, especially those containing cranes, recommend a regular program of inspection and maintenance to detect and remedy loose bolts. I recently spoke to an engineer who was struggling with loose bolts in a crane building and he has apparently worked with a researcher to try to ferret out the cause. They believe that within-tolerance geometric imperfections combined with restraint at the joints are resulting in conditions where firm contact is not being achieved even when large forces are applied to the joints. If this is the case, then the problem is that the joints effectively have never been pretensioned. The lack of pretension is allowing the bolts to loosen. One solution might be to provide tapered shims to adjust for the geometric imperfections. Where inspections reveal problems with loosening, steps should be taken to ensure that the joints can be properly pretensioned.
Another common misconception is that simply having a TC spline break or DTI washer flatten or having match-marks a certain distance apart indicates that the joint is properly pretensioned; it does not. A joint has been properly pretensioned if all of the RCSC requirements are met. The following Steel Interchange was intended to address this misconception head-on:
Relative to a "prescribed method for checking post-installed bolts" Section 10 of the RCSC Specification provides an arbitration procedure.