In a medium saucepan, heat olive oil over medium heat. Sauté diced onion and minced garlic until golden brown, about 5 minutes. Stir in chopped tomatoes, tomato paste, oregano, basil, salt, pepper, and red pepper flakes. Bring to a boil, reduce heat, cover, and simmer for 10 minutes until thickened.

In a food processor, pulse peeled and deveined shrimp until finely chopped. In a bowl, combine the processed shrimp with the sautéed onion and garlic mixture from the sauce, egg, and breadcrumbs. Mix until well blended.

Rinse cleaned squid tubes under cold water, then dry with a paper towel. Fill each squid tube with the shrimp stuffing, leaving about an inch open at the end. Secure openings with toothpicks.

Dust each stuffed squid lightly with batter mix. In a large skillet, heat oil over medium heat and brown the squid for 2-3 minutes on each side. Transfer to the simmering tomato sauce and cook for another 20 minutes.

Coat the leftover squid tentacles in the batter mix and fry in heated oil until golden brown, about 2-3 minutes. Place on paper towels to drain excess oil.

To serve, arrange the stuffed squid on a platter, ladled with tomato sauce. Garnish with fried tentacles and chopped parsley. Serve whole or sliced into rings.