I'm in blender 4.2.1, no matter how high I turn up the angle for the smooth by angle, the hole punches never smooth out?
The holes are made with a modifier (boolean), which means they're not real geometry. Because of that the shading auto smooth does not affect the holes. You can fix this by shading the cutter object that makes the holes auto smooth and adjust the angle in its modifier. The smooth shading will then transfer to the holes.
Mind that it will not make them perfect circles. In order to achieve that you need more geometry on the cutter. You can do that easily by adding a bevel modifier with a very small bevel value and after that a subdivision surface modifier with a value of 1 or 2 depending on your desired result.
I ran into the same problem. I just checked the Ignore Sharpness box under the Angle and ended up with the same result. Not sure what effect it this would have down the line but for the purpose of this lesson and results, it worked out for me.