I just try to be competitive with the opponents. If that means being the underdog, then so be it. But I would rather try alternative ways of limiting my car/means of being fast. So for the GT World championship, where most of the cars a SuperGT, I used a Lexus SC430 SuperGT car, ran default Hard tires, no aids, no abs, in car view and no HUD. Was one exciting set of races!
For the German League 2 (extreme series, sorry I can't remember the exact name), I ran with a BMW Z4 M Coupe '08 default settings. It was ~200hp down, but 300kg's lighter than the opponents. No aids, No ABS again, with HUD this time as I used Bumper View (what I normally use) Both tracks were a lot of fun and really challenging to win. Took me a few tries on Cape Ring and Nurburgring to win but every race had exciting moments and were thoroughly enjoyable.
I don't hit the opponents cars, if I do hit them, I drop back and try again after the next corner, or if I pass them uncleanly then I will let them re pass. There are times where they hit will hit you and you can't help that, but I treat them like I would any player online, race hard but fair and I feel you get so much more out of the single player game.
It doesn't matter if you don't win, you get money and experience regardless of position, so I rarely restart a race.