The first problem with presence I noticed is that on practising it day to day, subconscious negative thoughts or feelings can still be undermining my performance so I have to deal with them on the level of thought.
Okay. So, you are experiencing negative thoughts and feelings. There are 2 ways in which feelings can take shape:
1. The painbody is awakened, possibly by a trigger.
2. The feelings are triggered by a thought.
In case 1, you will first feel a wave of negative emotion, and not necessarily any thoughts. You have to be present to sense the initial wave. Then, the painbody will try to manufacture negative thoughts. However, if you stay present it will not succeed. This is explained in detail in the part about the painbody in Tolle's books.
In case 2, the feelings have been triggered by a thought. This means that you have indentified with the thought. This is where watching your thoughts comes in. Now, watching a thought doesn't have to mean stopping whatever you're doing and dropping into a meditative state (although that would be the best thing to do). You can just continue whatever it was you were doing, but do it as focused and mindful as possible, while remembering that the thought is just part of the ego. If you do this, then this:
Observing them alone surely can render you ineffective in what you need to do in the moment.
will not be a problem, since you can just continue any activity. Staying present, or being mindful when you are engaged in an activity, is the only way to alleviate negative thoughts and feelings. They can't be dealt with on the level of thought. That would be the ego attacking itself, an ouroboros. You need to rise above thought, using presence.
This may be interesting for you to read:
https://www.wildmind.org/applied/daily-lifewell...they always will be...nothing you can do will blot them out...
Blotting them out is not the intention. Recognising them as part of the ego is.