Insulation Drill & Fill - what's the story?

Hi everyone, thanks for any insght here.

Just bought my first house - a bungalow in Hamilton. It's been pretty cold in this house since I moved in in Feb. Thermostat shows 68 degrees or whatever I set it to, furnace shuts off then turns on, but the house is cold. Forced air gas furnace, supposedly a decent one according to the inspector - it's only 2 years old.

Drilled a hole in one of the exterior facing walls and it seems like there's actually little or no insulation in there. I've learned that this is far from uncommon in a 60 year old bungalow of this type. This house has siding on it.

So I became aware of GreenON and started calling contractors. I'm having some trouble getting the same story.

1. Let's say there's 4" of space between the exterior surface of the drywall and whatever you hit when you poke a pencil in there (I assume it's plywood or something). If I do a Drill & Fill, will I be able to get the R value up to R20 which is required before GreenON will pay out?

2. Another contractor told me to Google 'Drill & Fill Horror stories". He said that if you don't put a vapor barrier in on the warm side of the insulation and just do a Drill & Fill, you can get mold and mildew. He said he's seen situations where Drill & Fill results in entire sections of wood studs/drywall rotting away. He says that to do this properly, I need to take down the drywall, insulate (likely spray foam, I assume) and then re-drywall. Comments? I want to do this right but ripping out all the drywall... man oh man. It's a very small house but still.

3. One guy said the only way to do Drill & Fill is to drill holes in the interior walls. The next guy said he'd take an exterior siding panel off, and do it from the outside. Remember, both of these guys were on site. Second way seems way better because there's no filling/sanding/painting involved. I called the first guy back and was honest and told him I was doing what GreenOn told me to do and that is to get 3 quotes - I asked him if he would do it by taking the panels off. He said that it would be too hard because my siding is put on top to bottom? Comments?

4. Windows in this house have been upgraded but the same contractor as (2) above told me that the reason my house is cold can have to do with things other than lack of insulation in exterior walls. (I should say that the attic is only R15 and it was made clear to me by the inspector that I needed to upgrade). In fact he seemed to suggest that increasing insulation may not have that big an impact on the basic issue which is that it's hard to feel warm in the house! Very surprising to me. I'm just looking for comments, my real questions are (1) and (2) above.

Any advice is appreciated... a lot.