Clueless, it might be a good idea to read up on how to care for and transplant cactus.* There are many books in the library that should be helpful.* When you measure a pot for size so you know what the next size you will need, you can measure from top to bottom.* For a novice I would suggest you use potting soil labeled for cactus.* It won't pack down and will drain better.* Use clay pots that aren't glazed.* Most folks tend to overwater their plants and that is very easy to do with a cactus.*
Since you say it was in the pot you purchased it in for a year, did the roots fill the entire pot when you took it out to transplant?* This isn't a cactus, but does show what a rootbound rootball looks like.* Did the roots look anything like this?
Can you post a picture?