This is really interesting, and I can't claim to have enough experience to say if red hooks really help or not, but if they do, I seriously doubt that it's due to any "blood connection." I'm not discounting a fish's eyesight, but we all know that their sense of smell is highly developed, and that's primarily how they would detect blood, or any other substance, in the water. I seriously doubt that a fish is going to mistake something for blood, if it doesn't smell like blood. It seems much more likely to me that it's due to the fish not seeing the hook as well, which makes the bait look more natural. But who can really say for sure?