I can't stand having anything on my back, like a backpack, especially in warm weather. I use a front bag on this bike, I don't notice it getting in the way of my hands.
P4120234 by
galoot_loves_tools, on Flickr
On my commuter, I have a fairly large front bag held by a VO decaleur on a front rack. It can hold a change of clothes, extra lights, and a cable lock, etc.
P4170268 by
galoot_loves_tools, on Flickr