Preheat oven to 450°F (about 230°C).
Arrange baby potatoes in the center of a large sheet of aluminum foil. Drizzle olive oil and season with salt and pepper.
Seal the foil packet tightly on the top and both ends, leaving some empty space when sealing the packet to allow the heat to circulate. Place the foil packet, seam-side up, on a baking sheet.
Bake baby potatoes for about 35 minutes or until tender.
Meanwhile, heat a small nonstick saucepan over medium heat and cook chopped or ground bacon in its own fat until lightly brown (about 4 minutes). Add the garlic and sweat for about 1 minute, stirring occasionally (do not let garlic brown). Add and stir together the tomato sauce, wine, water and a pinch of ground black pepper; then reduce heat to medium-low and let simmer (large burner) for about 5 minutes, reducing the sauce almost completely. Turn off the heat, cover the pan, and set aside.
When potatoes are cooked, remove from the oven and place packet on a cutting board. Open the packet carefully to avoid injury from the hot steam. With the help of a knife, cut a wedge along the length of the top of each potato.
Fill the cavity by spooning in the bacon in tomato sauce, and sprinkle with chives and Parmesan cheese if desired. Serve baked baby potatoes with bacon while still warm and enjoy!