London had exactly the same system and the same fare evasion problem on the high traffic bendy bus routes. These routes were always overcrowded probably because of the number of unrecorded passengers using them. They withdrew these buses and replaced them with ones which take longer to board partly because of the fare evasion and partly because a sort of bizarre bus xenophobia (hatred of a foreign european style of bus) inspired by the Evening Standard which resulted in an election promise by mayor Boris to get rid of them.
Solving the overcrowding issue is more complicated than building higher capacity buses - you have to think about the speed of boarding, route layout, speed of navigating London's congested streets, fare evasion and more. In some places, the bus stops allow for two bendy buses or 3-4 regular buses to board at once, which means faster boarding on regular buses during peak times.
The new Routemasters, with 3 doors and 2 staircases, might prove to reduce overcrowding despite their lower capacity.
http://missionlocal.org/2009/08/muni-fare-beaters-slapped-wi...
Local activists typically lobby against enforcement as they interpret it as targeting a vulnerable population. On the other hand, MUNI is running a deficit.