I checked the triple meter wiring diagram and it is isolated from the engine oil temperature circuit. The ECM reads the oil temp and sends it to the triple meter via the CAN bus.
I am starting to suspect the ECM
The engine oil temperature circuit (and every other ECM sensor input) uses 5 volts.
Is it possible when the wires melted the bare 12v alternator wire touched the bare oil temp wires? If that happened, 12 volts would have been sent to the 5 volt sensor input.
We know the 5 volt supply is good, as you measured almost 5 volts with the sensor unplugged. AND the ground is good, since you had 0 volts.
The engine oil temperature circuit inside the ECM connects to a "multiplexer" (multiple inputs with a single programmable output) before it goes to the analog to digital converter in the main CPU (actually a SH7059 32 bit RISC microcomputer) I suspect one of those two items may be damaged.