The C-peptide test does not, as far as I know, measure for insulin resistance but rather measure to see if you are producing any insulin.
In type 2 diabetes, there is usually a combination of insulin resistance plus some reduced insulin production. Both of these factors can vary greatly from person to person. Catherine is absolutely correct that the longer you have T2, the more progressive it is in terms of reduced insulin production.
Having said that, however, if you stopped taking the amaryl because of hypoglycemic events, you may not want to start on insulin just yet. Hypoglycemic events are not at all uncommon when taking insulin. I suspect that's why your doctor is trying to manage this with oral medication, rather than putting you on insulin. I would also recommend that if you go on insulin or back on the amaryl, that you test more often so that you can determine what causes the hypoglycemia (increased exercise? less food? stress?) Once you get a handle on that, it becomes easier to avoid extreme hypos and you'll learn the symptoms and test earlier, when you can treat it yourself with some sort of sugar (fruit juice, glucose tabs, hard candies, etc.) BEFORE it gets so low that you need to be hospitalized.
Whatever you do, you need to get your A1c back down. 7.2 isn't exactly TERRIBLE, but it's not terrific either.
Ruth