HW store rescue - Need help with this Paph

[Darth Schrute]

Hello Everyone! This is my first post here so be gentle with me.

Last year I "discovered" orchids by falling in love with a bizarre but beautiful spider-ish variety at a local mega-hardware store. It had this single massive black (purplish) flower on top and this amazingly long, think stem that was covered with very tiny black "hairs" that gave it the appearance of a spider's leg. I had no idea how to take care of an orchid when I bought it and now I think I might be paying the price... The flower eventually rotted and fell of and I didn't know what to do so I just cut off the stem and assumed a new one would eventually grow back since the leaves still seemed healthy.

Now a couple things are happening to it. I see signs of rot at the base of the original stem that I cut off several months ago. I also see a new orchid that started growing on the back of the original. The new orchid is showing signs of rot on one of it's new leaves so I assumed something nasty was going on in the roots. So I delicately removed the plant from a mass of disgusting looking moss (which was covered by pretty rocks) and found a bunch of brown half-dead roots with one single semi-healthy looking white root.

I assume the white root was from the new plant and a good sign but I don't know what to do about the rest. I followed some advice to remove the dead and squishy roots and then I re-potted it in bark instead of moss but the leaves on the new plant seem to be getting worse. Do I need to "sprag-n-bag" my little friend? Should I remove the original plant so that the new one can utilize all the available good roots? Will spraging and bagging cause the new plant to not bloom this year? It looks like it's about ready to start making the stem that holds the flower (sorry for the amateur verbiage).

I've attached some rather poor pictures of my dilemma. Would some kind soul tell me what I should do? If spragging and bagging is the answer, can you point me to a "how-to" that will show me how? Many thanks!!!

~Alex