David Stockdale had already kept out a Glenn Murray spot-kick when Palace were awarded a second on the stroke of half-time when Jack Hobbs was harshly adjudged to have handled Murray's shot.
Stockdale got a hand to Phillips' penalty but could only divert the ball into the opposite corner of the net, and the evergreen striker added two more goals after the break as Palace ran out 4-2 winners.
Bruce said: "I've no complaints with the result but that may be the worst penalty I have ever seen.
"It was a shocking, shocking decision. Referees make the decisions but we have to live with them.
"Kevin Phillips has always haunted me over the years and even at this age he is still doing it. His second was a mis-hit and the third got a deflection so we knew it wasn't going to be our night.
"But there are going to be a lot more twists and turns yet."