We had a hardwood flooring professional install some planed white oak flooring next to our existing hardwood floors of the same age, grade, type, and thickness. Then he was going to lightly sand everything before refinishing the whole thing. Before sanding the existing flooring, we stripped off most of the shellac with denatured alcohol. Their sanding job was poor on the existing flooring because there were parts that were almost sanded down to bare wood and other spots that looked like they hadn't even been touched (all done with a 6' random orbital). I expressed my concern that the stain was going to take unevenly, but I was assured that it would look fine. They stained the floor with mahogany-color Minwax oil-based stain (the same thing we had used on the steps right next to the floor) but it was not nearly as dark as it should have been. We came when it was still drying and noticed that the floor was blotchy and showed many obvious sanding errors. In addition to that, 50% of the seams between the flooring pieces had stain coming up. So, my wife and I spent an hour and a half wiping the stain of the seams and evening things out. These "professionals" then finished the floor with Minwax extra-fast drying oil-based polyurethane, even though they had told us they were going to use water-based. The floor was pimply everywhere--every square inch, with chunks of poly sticking up everywhere in addition to the pimpling. Little hairs (from brushes? and heads) were found every square foot or so (450 square feet). We told them we were unhappy. They still had another coat to do and said that they would sand it down before sealing again. We came back after the 2nd coat and it was worse. At this point, we told these people we didn't want them working on floor anymore. We were going to fix it ourselves and pay them less. They told us to use a 320-grit sanding sponge over the whole floor and that should get rid of the pimpling. We started doing it and it seems to smooth the floor out, but the big chunks and hairs have to be scraped off and then it looks like they take a chunk out of the finish.
My questions are:
1. Is there a better way to do this?
2. Should the floor be coated one more time after sanding? (I think yes)
3. Can I use water-based on top of oil-based poly (I think yes)?
4. Is this job done by a customer (me) worth more than $150 off the price? The most he was going to take off is $350 if I think it was $350 worth of work, otherwise he thought it was only $150 worth of work.
5. There are some spots where the finish puddled (in a thick border area). What's the best way to get rid of that?

I can attach photos if anyone wants to see them. Your help is much appreciated.

The way things went it sounds like the job should be resanded.

I personally don't think you trying to go over the top of something that was done poorly, considering your lack of skill, taking advice from someone who couldn't get it right themselves is going to end up with anything less than a botched job.

hire another outfit.
the hairs were probably from a new lambswool applicator being used.
320 grit is to fine to abrade and properly smooth out an oil finish.

I wouldnt go hybrid finishing either at this point.
there's a saying in the biz... Cheap Price, pay twice.....

oh how true it is.