Holes (or not) in terra cotta pots?

[jkhom]

I grow all of my orchids (oncids, catts, phals, etc.) in terra cotta pots with holes or slots in the sides. My success has been relatively good as I keep an eye on the moisture level and water accordingly.
My neighbor has her orchids in fancy terra cotta pots without holes/slots, some are glazed. She is having a problem most notable with a large oncidium where there is no new root growth and the p'bulbs are all shriveled. I think she is killing her plants with too much care. The media seemed too wet when I was examining her plant and I believe she is overwatering all of her orchids.
Would it be wise to drill several 1/2" holes around the sides of her pots to allow for air? Would it be better to just drill more holes on the bottoms? Do you use pots with or without holes?