The prison is for humans, to help with the soul harvesting and all that, and Phineas was probably dumped there because Mundus is an impetuous ruler who does things on angry whims. That's one of the plot points, that Mundus is so impetuous that The Order goes around ruining his sh!t so he'll get angry enough to come out.
Phineas escaping also isn't an option - he's trapped in Limbo, in that prison, he can't leave. He essentially was imprisoned in "Magneto's Cell." He was there for hundreds of years, if he could have gotten out, don't you think he would have...? We wouldn't be having this conversation if he was able to escape, unless he stays there because he looooves getting hassled by harpies all day. Phineas also wasn't imprisoned for "betraying Mundus to help Sparda." He's been there for hundreds of years, remember, a lot longer than Sparda and Eva have been together. Furthermore, Phineas referred to himself as "a political prisoner of Mundus," which means Phineas was imprisoned for having differing views, probably about the genocide of the nephilim.
There's also nothing that says Phineas is the only person who knows about nephilim, and that wouldn't even make sense as to why Vergil and anyone else would know of them if Phineas was the only one. You're overestimating the threat of an eternally imprisoned old guy with knowledge of a "dead race." Yes, knowledge is power, but who would he have been able to help with that knowledge stuck in a prison no one could get to. And at the time of Phineas' imprisonment, there were no more nephilim that could have crossed into the prison anyway, so there was literally no one he could have helped. At the time of Phineas' imprisonment, there was no inclination to believe there was any nephilim for the old guy to help, since he was imprisoned for hundreds of years before Dante's birth. So "also killing one of the only people who knows anything about nephilim that would be willing to help dAnte" means literally nothing, as a hundred years back, there was no one that Phineas could have helped, and certainly no Dante to have ever worried about.
Are you just complaining from a cursory glance at DmC, or what...?