Phoebe is having a hard time caught in the middle between good and bad. As much as she loves Cole and accepts her new role as his queen, she's still too attatched to her sisters. There's still some good inside of her and she can't fight her true nature.
Finally, when she's forced to decide whose life to save, she steps up to her sisters and together they vanquish Cole.
This episode was amazing and the moment when Phoebe kisses Cole goodbye and then puts down the crystal was just so sad. I love this episode, even though I cried along in the scene when Paige and Piper joined Phoebe in bed to comfort her. It was just such an emotional scene, a m a z i n g !!