Heat Pumps and Electric Heating - Oil in indoor air handler coil

I have a 1995 trane 4 ton matched system. The outdoor unit model is TWR048C100A3. I also have a home warranty which covers the system. The Heat Pump was checked before closing and everything looked good. About a month and a half after closing the air handler coil started icing up. I replaced the filters but it continued. The home warranty company sent someone out to look at it. They said that it was low on freon and added 1.5 pounds of R28. It worked much better and the icing up problem went away. I went on vacation a few days later and came back to a 90 degree house with the heatpump running but not really cooling. It does remove humidity but the air is about room temperature. I called the warranty company and they sent the repair men out again. I later checked the connection where they added the freon on the large line coming into the house and it appeared to be leaking oil so I tightened the cap. They said that the air handler coil was full of oil as well as the top of the compressor. The warranty wants to replace the air handler with a carrier air handler because it is cheaper than a trane coil. Does this course of action sound correct based on the oil in the air handler? Does anything sound questionable about this? What kind of issues should I look out for?

Thanks

I know you don't want to hear this but I will say it anyway. Tell the home warranty company to take a hike & call your own service people. In general, those who do home warranty work are the bottom of the barrel.