Was able to have the headliner re-covered successfully, perfectly matched and took less than hour & half. Still considering finding a material to go over the headliner material - something with flowers or butterflies.
I think a big part of the problem with the edge coming loose was that is was not wrapped around any extra from the factory, something the upholstery shop (Todd's in Sanford, NC) did to help it last, but so far as the bubble that was falling down in the middle of the passenger area, the foam was completely disintegrated underneath.
The car originally came from Florida, then went to Viriginia, so climate likely did play a part, but the fabric is ash gray, although the most of the interior is charcoal gray.
I have a 2000 chevy s10 pickup and the original headliner is still in really good shape, so I was surprised that this happened in my '05 Crossfire, but am doing what I can to take care of her. It's a love thing.