Use flour vs oil in rising dough
In both cases, the goal is to keep the dough flexible so it can expand as it proofs.

With flour dusting, the proofing dough is usually stored under a damp towel, so that the moisture keeps it from crusting over.  The flour is really to keep it from sticking to one's hands or the counter, and therefore easy to handle.  Proofing periods also tended to be shorter--a few hours at most--so even a dry towel would often be good enough.

Oiling the poofing dough makes a moisture proof barrier, so it cannot dry out and therefore crust over.   With the rise in popularity of high hydration breads (lots of liquid in the dough), the soft dough is hard to coat with flour as it tends to get absorbed; oil is easier to apply.  It also is suitable for longer proofs like overnight fermentation that are more and more popular.  If course, it does introduce a very small amount of oil into the loaves, as well.

I would hesitate to say one method is strictly better than the other, but rather that each are effective in their context.  If I was forced to choose, I think the oil method is more flexible to more types of loaves, but may be somewhat messier.