As far as I know, a distributor with points has no 'pick-up coil', so your shop may be telling you something 'odd'. A stock distributor does have a condenser (or capacator - same thing) that can go bad. A Mallory coil would give a stronger spark but that would not prompt a distributor change. There is only one distributor that will fit, so unless it was screwed up in a rebuild, it should be long enough. At the bottom of the distributor is a hex rod about 10 inches long that drives the oil pump. When a distributor is removed, sometimes that rod gets lifted up and could drop into the oil pan - results, no oil pressure. With a 65, the normal indicator is a light (except for GTs). It does seem that whatever this shop did, your car got worse. At this point, find another shop and a lawyer.
Jim