Get rid of `panic` calls

[nickeskov]

Summary

After migrating to the slog logging library, several panic calls were introduced (see details: #408 (review)).

The goal of this task is to eliminate all panic usages and replace them with proper error handling and propagation.

Requirements

1. Remove all panic calls

• Identify all occurrences of panic in the codebase
• Replace them with appropriate error handling (returning errors, wrapping, or logging where applicable)

Acceptance Criteria

• No panic calls remain in the codebase
• make completes successfully without errors