I use a pencil like you do but I make sure that the line comes off the top of the spool when I reel it onto. I brace the pencil between my legs behind my knees and keep pressure on the line. Never had any issues with line twisting.
Or another tip is to spool it on the way you do and then once you are on the water... start your motor and engage it forward and let all the line out without any lures or swivels attached, then while you are moving forward, reel it all back in.
Another would be to drop the new spool into water, start reeling and let it unwind freely all the while keeping pressure on the line.
I would use a good quality swivel for your Red Devils.
Leechman