Oil can stay on the dipstick without there being any in the engine. If you remove the stick after wiping it and no oil is shown then there is so little oil in the engine that it doesn't register, so basically zero. You can try putting five quarts of cheap oil in the engine if you want, and it may get you by, but it sounds like the engine is already toast.
Of course, the oil had to go somewhere. Three options. One, someone drained the oil and didn't refill the engine (make anyone mad?), it leaked out somewhere, or it burned the oil. I suppose when the engine is running the oil pressure needle stays low, right?