I thought it was root bound so I gave it's roots a trim a couple of months ago, but now I think that wasn't the case.

Any help that anyone can offer would be greatly appreciated, I'm feeling quite devastated 😞

I don't see anything unusual in these pics. Orange is a normal color for Dracaena roots. Is it close to a window?

It looks like there are new roots coming out above that big wound. Like Tiffany said, orange roots are normal for Dracaena. I do see some sloughing of outer root tissue on some of the roots, so you can remove those damaged parts and plant it deeper if you want.
It's normal for the plant to droop a bit for a while after having a root trim. The newer leaves will perk up as they sprout from the center.

Thank you so much @CalPolygardener and @purpleinopp for responding! I really appreciate it!
The dracaena is near a south/southwest facing window and gets lots of light, I didn't realize their roots are usually orange, that's a relief!

I'll remove damaged roots and plant it a little deeper as suggested, hopefully that will encourage new roots. I was just worried that the damaged area was some sort of infection (the damaged part is black and when I lightly scrape it with my nails, it's very flaky). But hopefully this guy perks up as the weather starts to get warmer.

Quick follow-up question: if dracaena roots are normally orange, how would I know if there's root rot? Would they become black and soggy?

Thank you both once again!

Not black and soggy, grey/white and soggy.
That location sounds great for lighting. It should perk up fairly fast.

I do not recommend planting it deeper. I tried that and they never add roots form the newly covered trunk.
If you lift it and let styrofoam fall from the bottom of the root mass, add good potting mix to the pot and replant. Then it'll send new roots down.

Thanks @sallyg !
What kind of potting mix would you suggest? the soil I have not definitely feels too moist

I use miracle gro, scotts, espoma, or comparable peat based potting mix.
I used some off brand cheap stuff from Walmart, once, said it was made with paper fiber or something, I fear it was connected to some plants failing months later.

@rrozinaalii
Welcome to NGA!

I agree with Tiffany @purpleinopp and @CalPolygardener, it needs to be set deeper so it can root above that damaged zone. There are root initials trying to develop above the damaged zone zone already, I drew white arrows to them. The white lines mess on the lower right is just marking the top of the damaged zone. Looks like it needs to have about 2" covered above the top of the wound.
Is the other side of the trunk OK? Not shrunken and dry like the side showing? That would be good but not essential. If a dicot was girdled all around, as dead as this zone, the top would die. But monocots have diffuse vascular bundles throughout the stem, so they can survive it providing the inside tissues are OK.

Pat

thanks @sallyg appreciate it!

thanks @Hortaholic I am worried about the inside tissue, I'll plant in deeper as suggested and see how the plant does.
thanks for your help!

@rrozinaalii
Yes, I think your concern is reasonable. The wilted appearance of the leaves suggests water is not moving up the stem well.

Pat