My engine blew, warranty wont cover. Can I take legal action, or what to do?

Not to take sides, but you're supposed to check the oil. I can't imagine the gauge or light didn't come on warning you about low oil. I think you're on your own and would have a hard time finding a lawyer to take this on contingency, but you never know. Doesn't hurt to ask. The dealer may give you a nuisance settlement just to make you go away. I personally think that stinks, but people do it every day. If you read your own link, it says Toyota would have fixed the problem if you had warned them of the high consumption. Oh well.