And that's exactly why I think he should have been sent off, and those that dive looking for penalties too (where it's a blatant dive rather than going down easily).
Well, yes/no, there are plenty of penalties given without a red card, even without a yellow. Shawcross I think managed to give away a penalty then get a yellow later in that game(not today, last game I think) and yet wasn't sent off so can only assume he wasn't carded for the penalty.
But you're right, I think dives need to be on this same scale and maybe indirect freekicks need to be doable in the box. IE if a player is going away from goal, not a goal scoring chance and dives, it's a yellow, if he's actually fouled, indirect freekick. If someone hacks a player down who is otherwise through on goal, then it's a red card, if a player dives in that situation, red card.
The thing that is difficult is, there was a little contact on Welbeck, but it didn't take out his standing leg at all and he went down because he just pulled up his right leg, rather than continuing running. You can make a case that he was assuming the contact might be worse and was protecting himself, so maybe a yellow or no card but no penalty.
What if you send a player off because he slips as he shoots and it's deemed a dive. There isn't a whole lot of fairness about it, video replays, catching most incidents of most types of cheating would pretty much stop all diving, all shirt pulling at corners almost instantly IMHO.
For Oscar I would say a red wouldn't be unfair based on as you say, what he was trying to win in return for his cheating and his was a pure case of diving.