Dimethyl ether (DME) is economical, safe, and environmentally friendly. However, it is gaseous at ambient temperature and pressure, which complicates experimental evaluations for its application in assisted oil recovery. Therefore, a multifunctional experimental system for gas testing was developed. Based on this system, the wax dissolution, wax inhibition, viscosity reduction, corrosivity, and recyclability of DME were tested. The experimental results indicate that DME exhibits a wax dissolution rate of 0.086 g/min, a wax inhibition rate of 89.02%, and a viscosity reduction rate of 98.8% at a mass percentage concentration of 5%. These values far exceed the performance requirements for wax inhibitors and viscosity reducers specified in industry and enterprise standards. Additionally, DME has a recovery rate of 96% at 60°C and does not corrode downhole tools under typical dosing conditions in oilfields. Comparative experiments with commonly used wax inhibitors and viscosity reducers in oilfields demonstrate that DME offers superior wax inhibition effects on high-wax crude oil from the Wushi 17-2 oilfield and viscosity reduction effects on water-free heavy oil from the Tahe oilfield. Therefore, DME holds great promise as an oil recovery aid.