The C&O is mild terrain and as such, panniers wouldn't be out of the question. Panniers are great for accommodating bigger loads and making packing easy, but you lose a great deal of agility with those monkeys clinging to your bike. For singletrack touring, that's a critical consideration. Even pushing a bike along singletrack with panniers on your bike is a bummer.
The C&O won't require a bike with singletrack level agility, so panniers wouldn't be that bad, but once you set your sights on singletrack, you'll need to come up with a better solution. If - you want to keep your bike fun to ride.
Regarding bar bags, there are two styles. There are framed bar bags that have a hard mount and a frame within the bag. Those are much like a pannier for your bars. Great for mellow terrain which is why they're so popular for road touring and milder offroad touring. Soft bags, like those I use hold smaller loads (3-4 pounds) but they really don't alter the handling of the bike much at all.