Handle seedlings by the cotyledons (seed leaves), not by the stem. It's too easy to accidentally crush the stem of a seedling. That's one of the most common causes of seedling death. If your seedlings came up in a clump, lift the clump, and try to pull seedlings off by sort of lightly shaking and pulling two seedlings apart. Or lay the clump down after lightly shaking off all the soil you can, and tease the clump apart with a couple of pot labels.
If you are vastly overpotting your seedlings, you have to be *very* careful with watering, especially at first. Soggy soil that doesn't have roots in it tends to turn acidic from bacterial and fungal metabolism, and then when the roots try to grow into the acidic soil, they often die back. 2" pot is probably the maximum size for most of us growing tomatoes from seed and transplanting at the 2-true-leaf stage. If they get crowded in the 2" pot, you can shift them to a 4" pot later.
Also, always transplant into slightly moist soil. Water ASAP after transplanting.
Kay