The Leeds-born potter, 20, opened up a 2-0 lead at the Barnsley Metrodome against O’Sullivan, his first game since losing in the UK Championship final in York on Sunday.
But five-time world champion O’Sullivan held his nerve to avoid an upset against the world No 91.
Elsewhere, Doncaster’s Chris Keogan beat Brandon Sargeant 5-3.
The 21-year-old rookie will play the winner of Thursday’s match between former world champion Neil Robertson or Lee Walker.
But it was bad news for Leeds duo David Grace, 31, and Peter Lines, 46. Grace was beaten 5-1 by Jack Lisowski, the same scoreline which saw Yu De Lu account for Lines.
On Thursday, Sheffield’s Adam Duffy is in action when he plays Mei Xi Wen, as is Pickering’s Paul Davison who faces world No 3 Judd Trump.