Wrong wrong wrong wrong wrong!
The TAG mission is a thing of beauty, missiles and torps are basically useless in that system, due to the asteroids (Just be thankful it's not in the system Evildrome is in.) First off, ditch your torpedos, then max out your guns and turrets. You'll have plenty of space leftover for a pair of javelin pods. Get those and max out the javelin rockets. If you don't have decoy flares, get them. If you have the space, get heavy rockets too, you won't hit much unless you're pretty close, and at that range a heavy rocket will do more good.
Now for the tactics. Immediately turn away from the system center and get some distance between you and the Kestrels, then either waste all the fighters, or beg for mercy, it's up to you. Once their fighters are gone, and their missiles are used up, the Kestrels aren't much more than freighters. If you run low on ammo, or you're getting beaten on hard, land on the planet, or New Antigua. Don't worry, the Kestrels you killed will still be killed, but the remaining Kestrels will have their fighters and missiles again, so use this judiciously. A little patience and thought and this mission can be done in a Rapier or Lightning easily, probably an Argosy if you were feeling really nuts, but I don't recommend it. Kestrel, Corvette and Rebel Destroyer are ideal ships for this mission.
Best bet with the Kestrels, once their fighters and missiles are gone, is to look for stragglers, ones that aren't in a pack. Kill it, let your shields recharge, rince repeat. The most important thing to remember is that your guided weapons are useless. They don't do enough damage to be worth the cost, and relying on them only hampers your piloting skill.
Good luck, and happy hunting