We study the phase diagram and orientational ordering of guest liquid crystalline (LC) rods immersed in a quenched host made of a liquid crystalline polymer (LCP) matrix with mobile side chains. The LCP matrix lies below the glass transition of the polymer backbone. The side chains are mobile and can align to the guest rod molecules in a plane normal to the local LCP chain contour. A field theoretic formulation for this system is proposed and the effects of the LCP matrix on LC ordering are determined numerically. We obtain simple analytical equations for the nematic/isotropic phase diagram boundaries. Our calculation show a nematic-nematic (N/N) first order transition from a guest stabilized to a guest-host stabilized region and the possibility of a reentrant transition from a guest stabilized nematic region to a host only stabilized regime separated by an isotropic phase. A detailed study of thermodynamic variables and interactions on orientational ordering and phases is carried out and the relevance of our predictions to experiments and computer simulations is presented.