Did they tell you what the compression numbers were?

I've heard of stuck rings - rings that have oil deposits / carbon caked into and around the ring. That can cause poor performance (low compression) and oil consumption (oil control ring cannot "scrape" the oil off the cylinder walls).

Scorn rings - pretty hard to believe with a modern engine. Unless the mean scorn cylinder walls - which is a possibility, but should have shown up with lower than expected compression. These can spontaneously "heal" from deposits filling in the scored portions, but generally will not be that intermittent. Engine Restore product probably will not help - what I worry about those problems are that they can make the oil control issue worse.

Not just a simple matter of replacing the oil control rings - you have to stop the rings from getting stuck in the first place, treat the original problem from occuring, otherwise the new rings will be stuck again down the road.

Up to you, at this point, it is only worth doing to double check and retain the numbers. Any decent shop will write down the compression numbers for you on the worksheet - you've paid for the diagnostics, so they owe you those numbers. But given the test was $25 - which is surprisingly inexpensive - maybe they feel you only should get a pass/fail result.

Sounds like the mechanic is going by personal / previous experience - you can't tell an oil ring is scorn just from a compression test - have to take the engine apart. If they didn't do that - then they are just guessing at the problem. Very possible that the oil control ring is OK, assuming the compression was perfect, could be an issue with the wiper ring or second compression ring. Could also be excessive fuel dilution of the motor oil, causing it to shear down past its design spec. That point, oil will quickly be consumed by the engine, regardless of how well the rings work.

Engine Restore - product touted as an engine rebuild in a can. I've heard both good and bad things about it. If a shop pushes something like that - for me, that is a red flag that they don't want to deal with my car or don't care. Engine restore is something that I would pour into a dying engine to make it hold out a little bit longer.

In your 2AZ-FE - I'd be a little more concerned. Engine Restore has very fine copper, silver, and lead microspheres. It is classed as a EP additive, extreme pressure additive, which can help in cases of heavily scored piston and cylinder walls. In the case of your 2AZ-FE, if it does have stuck rings - it may actually plug up the oil return holes even faster - worsening your oil consumption.

Sure, an engine can consume oil between changes - how much it consumes is the real question. To lose 3+ quarts between changes on a standard 5K miles oil change interval - that is pretty excessive for a modern engine, in my opinion. If the car had 200K+ miles and is 15 years old - sure, I might be inclined to believe that oil consumption is a possibility. But not on a 2007 with less than 90K? miles.

Correct - stuck rings happen when oil is trapped in the ring lands (grooves in the piston). In the case of the oil control ring - there are drainage holes that allow excess oil, scraped from the piston walls to be pulled past the slots in the oil control rings, down through the holes in the piston, and back into the sump. If oil gets trapped there and doesn't drain out - it can get "cooked" by the extreme heat in the combustion chamber and eventually solidify into a pretty rigid mass. Once this happens, oil can seep past the oil wipers on the oil control ring and now have oil consumption.

The issue at hand is Toyota's design of the oil drainage holes. There are a number of holes in the ring lands - the ones that are immediately above the piston wrist pin actually lubricate the pin, the ones that are offset from those are the drainage holes. The pistons used to have a significant drainage slot, that allowed oil scraped from the walls to drain down en masse. So oil gelation / oil deposits were not really an issue. They redesigned the pistons to remove those "features" to boost engine and fuel efficiency and and count on oil technology to be able to help keep things clean. Problem is, coupled with the timing chain, elevated engine operating temps for emissions, etc. - the motor oil is now subjected to extreme conditions. Pick a poor oil to run, run the engine too hard, or push the oil change interval too long - oil will breakdown and clog those holes.

The temporary fix is to drill more holes. This does not "fix" the initial design change - just offers additional avenues for oil to drain out. You could still get some of the holes clogged up - but since there are more of them, oil will still be able to drain out. Running oil with different additives might help - but many of the effective ones are now no longer produced due to their tendency for bioaccumulation and shortening the life of emission control equipment.