Remember that if you get "stuck" during this round, you automatically will draft last in the Federal League round 25 draft (even if you haven't defaulted in Phase 1). With 16 available franchises and only 8 rounds, you should be able to maneuver a bit better than in Phase 1.
Obviously, C2 is the critical position though, since there is only one pick per team from this bucket. I would not wait until the last round for this position.