Item condition affects:
- any damage output of melee weapons (no clue if bows are affected aswell)
- damage mitigation of armour against melee attacks and projectiles (bolt spells and arrows)
- mana cost reduction from focus effects of a staff
Condition does not affect accessories or stat bonuses in general; only +skill bonus will stop working at 70% condition (on any item type) as you already mentioned, Chryso.
No reason to believe that it is different on Phoenix; nothing in the QOL notes.
Broadsword Herald on that one:
https://forums.darkageofcamelot.com/discussion/177/repairing-items