Leaving the other plugs in will slow down the starter motor; it turns much faster with only one cylinder coming up on compression than with all 4 doing so. And when you read low compression, you are basically comparing how fast the piston is compressing the air to how fast the air leaks back out of the cylinder. Any change in cranking speed will make a difference when you are looking at a bad cylinder.
That said, as long as the method you use is consistent from cylinder to cylinder, and all you are doing is comparing the relative readings (which is all you should look at), then the exact method, gauge, etc. is not so important. Personally, I always take all the plugs out; but I have never seen any difference at all with the throttle(s) closed or open, so I just leave them alone. I also don't worry about trying to count revolutions, just keep spinning it until the reading doesn't change.
The squirt of oil is a valid test, but note that the pressure will always come up some. What you are looking for is a big change in reading, which implies the air was going past the rings. The oil will temporarily plug up the leak in the rings and hence you'll get closer to a normal compression reading.
With my compression gauge (which is the screw-in type), it is easy to unscrew the hose from the gauge and put an air fitting on the hose. I also have to remove the Schrader valve core from the piece that screws into the engine. Then I can use air pressure to pressurize the cylinder and listen for where the air is escaping. If the hissing is loudest in the exhaust, that means a bad exhaust valve. Loudest in the rocker cover indicates bad rings (or bad cylinder wall, broken rings, broken piston, etc). And you can listen in the adjacent cylinder (#4 in this case) to see if you are actually looking at a blown head gasket (which would be my first guess from those numbers). This is essentially the same test as with a leak-down tester (but without having to buy the tester).