Anya, I had something similar happen with Fairy Princess, it was late sprouting this year and I dug it up to find several roots had rotted. A couple of roots with eyes still looked decent and I replanted them in a new location (in the ground). It was slow to break the surface of the soil and kinda just stayed like that for a few weeks. Now it seems to be growing a little. This may be normal for a peony that has been set back by rot and then uprooted at the wrong time of year, but that's just a theory- I've never had one with rot problems till this year.