Hydraulic oscillator tools (HOTs) are effective solutions for mitigating excessive drag encountered during sliding drilling in horizontal wells. However, their field performance remains unpredictable due to theoretical limitations in modeling nonlinear friction behavior under axial vibration. To address this gap, a series of friction tests was conducted on sandstone–steel pairs under water-based mud lubrication. Experimental results demonstrate that steady-state sliding friction follows the velocity-dependent Dieterich–Ruina model, while vibration–sliding coupled friction is accurately described by the Dahl model. Integrating these findings, a comprehensive drillstring dynamic model was developed. The model was solved using an explicit central difference method and validated against field hook load data from Well XX-1, with prediction errors below 9%. Parametric studies further quantified HOT performance, revealing that excitation force amplitude and HOT placement significantly impact drag reduction, whereas vibration frequency exerts a relatively modest influence. Meanwhile, the effective propagation distance induced by the hydraulic oscillator is relatively limited, resulting in a drag reduction rate of no more than 30% even under optimal parameter conditions. This work establishes a validated theoretical framework for optimizing hydraulic oscillator parameters in horizontal drilling.