My DD had really inflamed cradle cap, so I got her some cortisone cream and it cleared up over a day! After that if it ever came back I put olive oil on it every night for 3 nights without washing it, then washed it on the 4th day and it was fine. I wouldn't recommend using baby oil as its full of nasty chemicals that will make it worse. There are some great natural baby products on the market that are tons better than J&J or even QV etc.
Hope it gets better soon