Amber low level oil warning then nothing?

[physh]

So I was driving my 135i today for the first time after I got it back from the dealer for a differential replacement.

As I was driving, I got the amber low oil level warning so I pulled over on a flat street. I ran the oil level check from the OBC and the car told me to add 1 quart. Fine by me, I drive another mile or so to Autozone and get a quart of oil. Before I pour oil, I check one more time and the car seems fine (no more warning) so I pour half in then go back into the car to run the oil level check again. The oil level gauge shows full.

I am quite puzzled. Why would the car complain about the oil level being too low while it only really needed half a quart?

Has anyone of you guys experienced that before? Is the oil level sensor poorly designed or has mine failed?

Thanks!