sounds like your lack of watering skills saved the roots...the plant does sound dehydrated tho....putting it in bark and watering thoroughly every week to ten days ought to bring it around tho...if you had watered normally with all that moss packed around it, it would have drowned and rotted the roots....especially with only one small drainage hole....sounds like you are doing just right now, good luck!
I bought a pretty Phal potted in moss and I water it much less than all my others that are potted in bark. Seems to be working. I figure that it takes much longer for the moss to dry between waterings. I am no expert though...
It does look dehydrated but it will recover with proper watering. Just be careful not to over compensate
@Optimist You've got a point. I've seen that advice given many times here on the board but individual experiences must vary. Phal roots are pretty tough, thats for sure.
These leaves are still photosynthesizing. They won't replump. The roots need to be watched carefully. Air roots/roots in media....all the same. Roots that are down in media are just fluffier due to the constant moisture available to them. "Air" roots are less fluffy due to their constant drying. Water the plant when it is light in weight and then let it alone until it is dry again. In time it will grow new roots and new leaves. Take the decorative moss off the plant as it can cause death by fungi and bacteria. If the plant is potted in moss repot it in bark or very loose clean NZ sphagnum moss.