Realistically the British ignored their own knowledge. They forgot the ease with which they hunted/killed her sister. Ludovick Kennedy in "Pursuit" mentions the shock that the Empire suffered as a result of Hood's loss. We know now that in all likelihood it was probably Prince Eugen that fired the fatal blow, but at the time, the Empire spin doctors would not allow Hood's death to be at the hands of anything less than the best/most feared battleship in the world.
As all Royal Navy sailors worshipped Hood and her invincible myth, the fact that Bismarck had a sister was just as frightening. The Brits allowed themselves to be cowed into fearing Tirpitz. Had she broken out of her fjord, where would/could she have gone? By mid 42 the RAF had air superiority over the Channel. Any "dash" by Tirpitz could not possibly be supported. The Kriegsmarine just didn't possess the ships anymore.
I continue to be amazed that this went on for as long as it did. Had I been Sir John Tovey I'd have written Tirpitz off long ago.