Sorry to hear about your Phal.
I can't grow my Phals in just bark like that because they dry out too quick and I'm not up for watering ALL of them that often. I can see your roots aren't too happy as you've described. Are they hollow and squishy? Or just sort of brown? They should be silvery green and then turn green when they're watered. Right now - winter - if I can see the roots are green and not white/silvery I won't water. If those roots are squishy you should cut them off, cut them back to where they're not squishy. Then you might be able to judge from how many or few roots you have if it needs a smaller pot and perhaps even more of a mixture of media. There's plenty of mixes out there with lava rock, bark, moss, perlite, charcoal, etc.
Phals don't freak out if they dry out between waterings so in your case it might not hurt to go ahead and let it dry before you water again. Then maybe you'll get a handle on what your plant needs in your conditions. If you start to see new roots growing then you're doing something right!
Good luck, keep us posted, oh and keep reading around on here to find better advice. There's a lot of information on how to care for Phals. Go to The Phal Abuse Ends Here.