Whether or not rotting wood crumbles can vary a lot depending on how wet it is at the time.
If you'd have a hard time picking up a log entirely made of the stuff, it's rotted enough. If it's not quite rotted far enough, that won't hurt anything. I don't think it's possible for wood to be too rotted unless it's turned into dirt. The really good rotted stuff is super soft, nice and spongy. I like how it feels. You can break it apart in your fingers, and generally should, to check for stowaways. Even if you're gonna boil it, it's good to try and shake out whatever live things you can before boiling it. Sometimes bumblebees nest in rotting wood, so you can find the grubs or pupae. Those in particular should be left alone- just put a whole little chunk with them in it back and let them keep doing their thing. You should also avoid termites, they'll eat the wood before your roaches do and might not be the best thing to bring into your house.