I have never seen such panic, knee-jerk reactions, and bad advice in one thread before. That might just be because I don't look in this forum often enough, but this is still ridiculous.
Take -everything- in here with a grain of salt.
The car is 10 years old. There is a 99pointsomething percent probability that the sensor is just acting up a bit, like even the person here that sells oil pickups said was the case.. If you are still worried you can (or have someone else) pull the oil pan and make sure everything looks good. AFAIK there has never been a recall on the oil pickups, and it is probably fine. Throwing money at gauges and other things will not help diagnose anything here, especially if you don't know what you're looking at.