When it comes to sex, you will only know when you try it (safely!). There are many men who experience pain during sex because of the thrusting that goes on.
There are many stretching techniques that you can try. There are also ointments that the doctor can give you to assist in stretching/retracting your foreskin. Circumcision is an option, however it is one that I would only use as a last resort if you're experiencing a lot of pain during sex. Once your foreskin is gone... it's gone for good!
It's also important to make sure that, especially with phimosis, you properly clean underneath your foreskin. You said that you can retract your foreskin almost all the way when you're flaccid... make sure you clean underneath it, as infections and skin irritations are a risk with phimosis.