let it sequester for a day.
Not sure if this is a typo or not, but sequestering is done AFTER dilution, you mention doing it BEFORE dilution. The function of it is to have non-soapy parts settle to the bottom or rise up, so the soap can be siphoned/decanted away from them.
As for the oily part; I get it frequently on a small scale, but especially last batch when I had to fix a bit of lye excess by adding citric acid and went overboard. If I had to guess, I'd say you have a visible superfat going on (either the KOH purity isn't what you think it is or a slight mismeasurement occurred (user error, scale error).
Mine is completely transparent and cannot be seen (thin invisible layer on top) until I shake the jar up a bit and it descends down into the soap, forming transparent oily streaks and patterns.
You could try:
-heating the soap for an hour or so up to 90 C (seemed to fix cloudyness for me once, might fix oilyness).
-heating it up, dropping a few (water dissolved) flakes/drops of KOH into it and stickblending, then waiting (days?) to see if the oil goes away. And repeating. If the issue isn't a superfat you'll just be making your soap caustic as hell
.
-if the oily stuff stays on top, just get a tube and siphon the soap out into another container. You can even try running it through a coffee filter and most of it will likely get trapped.
-just use the soap
, if you don't really care why this fluke happened (only option 2 of my suggestions attempts to find out), there is likely no harm in using it.
Keep in mind these are just things I would do, no verifiable scientific advice from me, sadly!