The $1500 is what it costs for oil-fired hot water in a boiler with high standby losses. By having to keep the boiler at high temp (160-180F) to deliver reasonable hot water performance, the standby losses are about 1.5x what it would be if the standby temp was 135-145F, and more than 2x what it would be running it cold-start (if it's a boiler that won't be damaged by cold-starting.) Electric hot water is very likely to be your cheapest/best option here if you are heating primarily with mini-splits.
If you're moth-balling the oil system and only firing it up as your "hail Mary" backup for the mini-splits, the standby loss heat normally heating up the basement isn't there. If the basement isn't already air-sealed and insulated (and it sounds like it isn't if it needs baseboards to keep it above 10C), it's worth it. In a NS climate with a 20C rooms above it a tight basement with R15 or better on the walls would never drop below 15C, let alone 10C. Insulating foundations has to be done carefully in a climate & construction-specific way to avoid moisture related issues- the practice of installing a batt-insulated studwall with interior polyethylene vapor barrier that sort-of-works in Saskatchewan is too prone to mold/rot issues in the maritimes. But 3-5cm of closed cell foam (sprayed or rigid) up against the foundation, seams & edges sealed with appropriate tapes &/or can-foam, with a non-structural studwall on the interior insulated with rock wool and NO vapor barrier works pretty well and delivers an R-value in the low 20s (making the basement the warmest place in the house when it hits -25C outdoors :-) ). There are many particulars to attend to- if you want to take on that project I can elaborate on that a bit. (Or you can search the remodel forum on this site for basement insulation- it's a topic covered fairly regularly here.)