Mineral oil is used as hydraulic fluid and is almost as corrosive to plastic as brake fluid is. It is indeed a wonderful conductor of heat, but I personally wouldn't recommend using it anywhere near a computer. Coating the parts in mineral oil will absolutely cause damage. Mineral oil is quite happy to eat paint, plastic and aluminum.
I've sen one or two of those oil filled pc's and the thing I've always wondered about them is "How does the oil get rid of the heat it collects?" Unless you're going to run the oil through a heat exchanger of some type, how is the oil going to cool?