Need help with cutworms!!!!

[Ralistin]

These little buggers are driving me crazy! Please help with sound advice.
 
I already gave up starting peppers from seed. I tried to grow them to 5 inches tall in pots but even then they cut them down after transplant. I have tried the following:
 
1) Pieces of straw around the stem but they simply climb up the straw and cut where they can. I do think this saved some of them so far though. I also made sure the straw was above the first node so leaves could begin to sprout out again.
2) Diatomaceous Earth didn't seem to help my cause. (Food grade)
3) Put a think layer of hay down as mulch but they just climb right through that to the plant.
 
I know there are other options out there on websites such as Bacillus Thuringiensis but that won't stop them from cutting it down before the bacteria kills them. I was going to try aluminum foil wraps but that also conducts heat easily. I could try an open ended can but that leaves a lot of open soil near the stem available for them to live in and I might not prevent anything. I just cannot think of a good tool to use for this.

 

[Ralistin]

Here is what I came up with today. I will have to take it off in 2 weeks as the pepper grows and do it again with a bigger hole. I will let you know how it works out. This pepper is coming back from being attacked already.
 
 

 

[Hafners]

Google nematodes, I used some in my garden last spring after cutworms devastated all my germinating seeds, the only survivor's being the well developed seedlings I bought from a greenhouse. The nematodes also greatly reduced other garden pests. Combined with the BT there should be very few pests left.