-the light switches off when the car starts.
-oil filter is changed along with every oil change at ~4000 kms.
Not sure about the oil flow thing but when the mechanic was checking, he had the cover opened. And when the car was started, oil was sprinkling out to the front grill when the pistons were moving. I think oil is being properly circulated.
Running the car on petrol for the moment. Have emptied one tank and there hasn't been a problem. Let's hope it goes away ob its own...