I expected less problems from a car that belongs to one of the highest rated brands for long term reliability. Sure I spent less and got less, but bang for buck I thought this car would be better.

Old cars that I've had or have with more miles and less problems

98 accord with 185k miles paid $1800. Loaded. Needed an alignment and the ac condenser. 40k miles and sold it with no issues.

06 escalade with 170k needed nothing paid $5k 10k miles now and still needs nothing.

06 gmc duramax 225k needed suspension paid $11k 45k miles now and no problems.

02 vw jetta 1.8t 165k needed coil packs paid $2k. 20k miles later no issues.

98 dodge Dakota 170k miles, traded a $500 TV for it. 20k miles and it has needed an abs sensor.

So yeah considering Toyota is supposed to be as good or better than all those brands, I expected more for my money.

 

Depends on how well the PO took care of it IME. I bought a '99 ES from a taxi driver in San Francisco (fifth owner), 243k. Dumped nearly $4k into it (including $1100 purchase price) to fix all the little problems, but it runs like a champ. Many of the same things you're describing (replaced both O2 sensors upstream, used a downstream MIL eliminator for the P0420, knock sensors, U140E trans cooler/inline filter upgrade, sludge cleaning, resealed nearly the entire engine).

Then I bought an '01 Coach from the first owner, who had it maintained completely by a Lexus tech on the side (151k). It's pristine apart from the blown fluid pump (U140E, so understandable. Annoying, but understandable), and leaky valve covers (the 2x 5/16" washers is a fix by the Toyota-savvy, which doesn't usually include dealer techs going by the book). Everything else on it works perfectly: P/S is silent (think this is the first car I've owned without whiny P/S); every button works, lights up, and feels new; leather is brand-new except for a tiny bit of paint off from the driver's seat, auto-leveling HIDs work perfectly, etc.

My point is really that I think you got something that wasn't well taken care of...Toyotas need maintenance too, contrary to what most of the populace believes. Hang in there, and I'm sure everybody would be glad to help along with the issues. Or just sell the car.

 

I think the problems you are facing are not because of the car itself, but because it was severely neglected by the previous owner. Lexus and Toyota cars are reliable, but like with any car, you have to take care of them.
As for the knock sensors - sometimes the wires in between the V-bank tend to get brittle - it would be a good idea to replace that harness as well.
Oil leaks are not uncommon for the 1MZ-FE engine - its most likely a valve cover leak.