EDITED: While I thought replacing the valve cover and PCV combo with a working set stopped the oil from collecting in the intercooler, it did not. I ended up pulling the turbo to find the waste (penny) valve was really loose, the turbo housing had cracks, and the nut holding on the impeller was eroded horribly.
I bought a new turbo and after 1k miles there is almost no oil in the intercooler. It has consumed some oil but its still within Audi's "1Qt/1k mile" is ok tolerance.
ORIGINAL POST:
I will add my recent experience for anyone else currently experiencing oil collecting in their intake and passing through the engine causing oil smoke
Our new to us 2007 A4 Avant with 2.0t was loosing oil at about 1qt per 500 miles. I eventually found that the intercooler cross pipe was filled with oil. After researching I tried replacing the PCV valve with a new OEM unit which made no difference and inspecting the OEM one I took off, aside from being full of oil it looked rather new. Digging through records I got from the previous owner their mechanic had recently replaced this, it seems they were offloading their problems without telling us as I specifically asked about oil consumption when we bought it and they said "uh, no, nothing unusual".
Next, I bought a chinese no-name valve cover for $120, part number REPA320401. Installing this increased the issue significantly. We'd blow a half quart every time we drove the car along with batman-grade smoke screens at cold start and on hill climbs. The PCV also would not fit flush and the 1/4" nipple next to it was too small on the I.D. for the hose that connects to it.
Luckily I also have a 2005.5 A4 B7 avant with 2.0T so I swapped this chinese valve cover and new OEM PCV valve as this car doesn't consume any oil. The first drive it blew a quart in 60 miles and then smoke screened the parking lot on the first following cold start. The oil issue followed the valve cover/PCV assembly.
So, our original 2007 valve cover had failed somehow although there were no visible indications it was failed. The PCV valve on both cars were fine. For the record, the failed OEM valve cover was black, the one that was working was from my 2005.5 2.0T A4 avant was silver. I bought another used silver one from ebay and it works great; neither car are loosing oil or smoking now.
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