As an update for those searching for threads to their problem...
Went to stealership and paid $30+ for coolant temp sensor (top one). Problem fixed. The old one was flashing blue towards the end and then after about 30 minutes of driving I would get solid blue and the oil pressure light would flash! Also got, beeping from the instrument cluster.
Apparently on the 1.8T software/ECU/cluster a faulty coolant sensor can also trigger the red oil light (one other ORG member posted this).
I was waiting for a CEL, but the beeping was freaking me out... replaced sensor and no more errors.
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