In most cases, I am in the habit of repotting newly-purchased Phals pretty much as soon as feasible, but especially ones that came from a local grocery store, of which I do have a few. The last one I bought from Kroger's had some kind of a soaking wet peat plug encased in a plastic cage down in the pot. Another one was in sphagnum moss packed so tightly I had to cut it apart in chunks to remove it.
Your Phal looks healthy right now, with beautiful roots showing through the sides of the pot. I think it could use a pot one size larger. I'm partial to chunky bark, but there are plenty of members here who use other potting media with good results. It's really a personal preference, greatly dependent on how often you are willing to water.
Ditto to Roberta's wise post starting with, "Don't rush to cut roots."
As far as the spikes, yes, they look like they could produce more buds, but if I had to choose between losing future flowers from those existing spikes, and getting that orchid out of its mass-market pot and medium, I would take a chance on losing a spike or two. With proper care and culture for your growing conditions, it will recover quickly and produce more flowers in the future.