Yeah, potting up was the right idea and it was also a good idea to do it in a different mix.
I have found that potting up and burying the stem more than it was before increases the chances of damping off very much (at least, it only happened to me when I did this).
What could have helped but now I guess it's too late was to remove the old medium from the roots, there's something that wasn't right there, the roots didn't function properly/didn't grow properly.
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