Never Heard Back on PhD Application but enrolled in MS program
I sympathize with your situation. To help understand your situation better can you indicate whether it is a US university and if you are an international or domestic applicant? Thanks.  Regardless, please see my response below, which is assuming you are an international student applying to a US private university.
There is a fundamental difference between Ph.D. and MS hires. Most international Ph.D. hires are paid (albeit menially) a stipend and their tuition is covered via research / teaching assistantships. In contrast, MS students bear their own tuition costs and in fact are a source of revenue for university departments. Therefore, money is potentially one reason that is causing this delay from their side.
Another delay is simply due to Ph.D. hiring cycles.  Most professors are part of committees they'd rather not be.  Ph.D. hiring is another such committee.  Therefore, many departments have fixed cycles within which they would proceed with the hiring.  Perhaps, you are ahead of the cycle in your department.  You can check this by asking pointed questions.
Additionally, professors in the US have the power to hire Ph.D.s at will if they have money.  Your discussion with a professor is a good way to ensure that your application is given priority.  However, remember that when a professor hires a Ph.D. student, they begin a long journey (5 years on average) during which a strong working relationship will be established between the two of you. Essentially, they are investing in you.  So keep that in mind in your conversations with the professor.  Furthermore, sometimes talking to current Ph.D. students who are already working in that group is a good way to figure out crucial information about the professor such as &quot;do they have money/funds to support another Ph.D.?  What is their nature and their expectation from the incoming student?  How helpful are they with job searching / student placement later? etc. &quot;
You mentioned an individual research project with a professor.  While it is useful to do this as it indicates to you whether you enjoy research, enjoy working with the professor and lab, it can also be a waste of time if you already know you want to get in the Ph.D. program with that professor.  Regardless, if nothin else works, an individual study is a great way to build a relationship and show your talent.
Lastly, I want to talk a little about approach.  Most students, especially those starting out, will likely be shy of asking the direct (and at times tough) questions.  It is important you mindfully not be shy/apprehensive.  However, also try not to come off as rude/impatient.  Communicating via email is an art that is learned overtime.  However, below are some pointers that may help:

Write short emails with pointed questions
Always try to be pleasant, try to not sound irritated, especially on email
If an email cannot be made short enough to be read in 1 min max., request the professor for an appointment. Indicate that a brief meeting of 15 mins will be enough, and get the conversation going
Use departmental resources such as graduate coordinator staff, other Ph.D. students to get a good idea on relevant background matters

I am pretty sure they are not being non-responsive because they think you are not qualified.  If it were that clear, they would have told you that.  I rather think that there is some kind of miscommunication / misalignment going on.  I hope it is sorted out for you soon.
Best luck!