Are we wrong about Bakelite formation mechanism?
C-acylation : acylating agent (acyl chloride or anhydride) and $\ce{AlCl3}$
O-acylation : acylating agent (acyl chloride or anhydride).This is the one which you have talked about in the question.


Since the formation of bakelite is by Lederer Manasse reaction which proceeds through electrophilic aromatic substitution on phenol, its path is similar to that in C- acylation and not O-acylation. 
Hence, the polymerisation of phenol and formaldehyde takes place either from two places:


For para substitution end:





For ortho substitution end: