First post here, but I’d like to give my input.
Anytime I’ve started to feel like that, I remind myself of why I started playing in the first place - because it is fun and makes me happy. When I didn’t have any idea of sizing myself up to others, I just learned / practiced the things I wanted to learn.
Fast forward to post music degree, I lost the essence of what drove me in the beginning. I stopped listening to the music I used to love because my ear had developed and it felt elementary in comparison to all the jazz and fusion I discovered. It felt empty at that point.
All the gigs where I got stressed about my playing and various others things - yeah, sometimes people broke balls, but a lot of the time no one really cared either way. Mind you, the people who poked at me in jest were always musicians, big fish in small pond types. You know what though? They had their crap nights too. No one is perfect and they’re delusional if they think other wise. They all had rude awakenings when they tried integrating into larger cities and the playing field was leveled.
As far as performance anxiety goes, I actually encourage myself to screw up sooner rather than later because I can only go up from there. Kind of like getting a new car and counting the days until you get your first ding. I’ve had some pretty humiliating gigs early on, but life goes on. I don’t think about whether the previous/following band in the lineup are technically better than me. At the end of the day, there are things they can do that I can’t, but the same also goes for them. I try to take those situations for what they are - being up in front of people, so I’m going to fake acting like I belong up there rather than succumbing to myself. It’s never easy, but I stay out of my head and focus on what’s in front of me.
Playing and teaching is your livelihood, so I realize there may be pressure to push yourself for the benefit of your business. You’ve clearly made it this far though, so you’re definitely doing something right. Maybe try shifting your mental state in regards to wanting to push your limits - it can be exciting to make something out of nothing and share those findings with your students vs feeling like you have to get better, or else.
For the issues with breathing and tensing up, it seems you’ve done most of the homework with that in that you know that it’s happening. I had those issues too, so now that the lick was under my fingers I made myself go back and practice it without tensing or holding my breath. At that point it is just fine tuning it. Maybe I’m being captain obvious, but I dedicate parts of my practice session for bodily self awareness (tensing) and holding my breath. Is my neck sideways? Is my right shoulder tense? It’s difficult, but for me just putting time aside for that stuff has done wonders. “Correct” posture and what not may feel foreign at first, but you have to force yourself to relax haha.
I hope some of that makes sense / helps. This happens to the best of us. To reiterate, try to always remind yourself why you bothered to pick this up in the first place - because it felt good and makes you happy (I hope!).
.