Oil on the bottom of the turbo? Check the turbo oil feed line (on top, banjo bolt) and the oil return on the bottom. Both will leak more if hot, and the oil will drip off the bottom of the turbo or down the return line to the oil pan and blow back to the rear.

I had this exact thing happen to me on the Volvo -- didn't have the feed line tight after a turbo replacement. Got oil drops on the back of the car, oily mess everywhere, stopped when I tightened the feed line connection.

Needle bouncing at idle would indicate worn out crank bearings -- when the feed hole for the crankping (rod) bearing is covered, you have pressure, when it is not, all the pressure blows out.

It is possible for the rear main to be bad, and this means an engine overhaul -- no on will be willing to pull the crank and replace bad bearings just to put a new crank seal in, and it will go pretty fast if the bearings are bad, or the crank worn.

Peter

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1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!