I don't think it would be an issue for a vast majority of applicants--my friend was just very, very research focused (i.e., 7 publications), and again, that's just speculation--could have very well been some other factor(s). i agree that getting a good grad GPA could help your case. It might be the best option for you on that basis.
👍
Sorry to hear about your health problems.
🙁 Both the upward trend and the fact that you have *very* valid context for your GPA drop should hopefully grant you some understanding in the GPA department.
I definitely agree that raising the GPA is a must. Even an 1100 may get you looked over at a lot of places. Have you considered the University of North Dakota, by any chance/ They have a faculty member doing ED research, and AFAIK they tend to be more lenient on the GRE than some other funded PhD programs. Balanced program from what I know, but I think their ED research is pretty active.
Good luck!