I see far more failure by way of deeming oneself unqualified and not applying than I do by way of train wreck interviews.
For me, job applications are like college applications - the best attitude is not to get my heart committed to anything outside my control, and not to take anything as a statement about who I am, and always will be, but rather on what, at a particular point in time, I can offer a particular person. I've had my ass handed to me in an interview before - It was a great experience - I learned what I needed to get better at to get the type of position I wanted, and through applications, failures, and learning, I eventually found a great position.