My brother has a VW compressor which runs on two of the four cylinders and
has compressor heads on the other two. Although it produces plenty of air,
it is oily, hot, and certainly can have a high water content in a Brisbane
(Australia) summer. As the compressor cylinders are lubricated by the dirty
engine oil, the oil content in the air tank is yuck. (Technical term!)

As a condensation unit he uses 20 feet of 3/4 inch copper water pipe coiled
up inside a 44 gallon (55 US gallon) drum full of water. The air enters at
the top of the coil and travells down the coil to the bottom of the drum and
then the copper pipe is bent back up out of the water. This cooled air is
then fed to a commercial water and oil trap which catches almost every last
drop of oil from the now cooled air.

He uses the air for sand blasting timber for artistic furniture and creative
artwork and the air is cleaner than anything else he has tried. If there is
any oil or water in the air it stains the timber and he gets pretty finicky
with his quality control......

If he uses it for continued operation, he changes the water in the drum
after about an hour or leaves a hose running to overflow the drum so the hot
water is continually changed with fresh cold water and the garden gets a
drink.

The copper pipe is readily available at your local hardware store, and a
copper olive from a standard plumbing fitting soldered on each end of the
pipe makes a great bevel for the hose clamp to hold against so the flexible
hose can't blow off. You might use a flair to do the same thing. This part
is cheap, the drum also is an old second hand plastic one (no rusty water)
with one end cut out, but a garbage can or and old oil drum would be just as
good as it only has to hold water and no pressure.

The lot is mounted on the back of an old unregistered farm truck so he can
keep it in the shed and drive down the back paddock when he wants to blast
the timber and that way he leaves all the mess down the paddock.

Hope this helps,
Peter