07 is the 1st year for 3.5 but that engine has been used on 05 Avalon since. The issue is certain engine noise, kind of like a "knocking" sound. Some owners complaint about the noise is loud but I guess it all depends.
the oil line is a confusing issue. the 1st recall take care of some 3.5 with NEWER rubber line and then later, Toyota has a Full metal line for certain model. Now I heard there a pharse 3 with new part number the the line again. Either way the recall should take care of it and I don't really care if its rubber or metal. Just keep an eye on oil leak if you worry about it.
Overall, 2nd gen is pretty good (Many believe its better then the 3rd gen)