Welcome to OrchidTalk. I just saw your posting. Regarding the fading blooms: It looks normal to me. The sunburned leaves you have already removed, so no worries there. I know several people grow orchids in sphag, but I prefer a bark mix. I drown orchids growing in sphag. lol. If you would like to repot your phal after the blooms fall off, I can direct you to a repotting article or two here in the forum.
As far as cutting the spike back, I would cut it about one inch above the base of the plant and seal the cut with pruning seal if it is still green.