Depends on what “oil” you are talking about, but since even blo has driers in it, they pretty much work the same. Any finish will continue to shrink down for up to several months as they fully cure out. It depends on the finish and film thickness. Most of the shrinkage is complete after 15-30 days. Depending on the “oil”, it could continue to soak into the wood for several weeks until drying enough to stop, but most of the absorption depth is reached in 10-15 minutes during application. The wood will absorb more “oil” each day because the volatile solvents have flashed off and the wood can absorb more. So, you are right.
Depth of penetration is mostly a function of the wood and grain direction (end grain will soak up more), and the viscosity of the finish. Most of these finishes have fairly low viscosity, with a lot of thinner in them, giving better penetration. Thing is, penetration with no film build does not provide a lot of protection. If something just hangs on the wall, it’s probably ok, but if it’s something that gets handled it needs a film to protect it.
I’ve used most of the “oils” out there – watco, Danish, various “teak” or “tung” stuff. Most are actually some oil and some type of varnish, alkyd, urythane, others. I’ve found good ole poly thinned 50% with MS will act just like any of these “oil” finishes.
