Exacerbation of Interstitial Lung Disease (ILD): This is the most likely diagnosis given the patient's history of ILD. Exacerbations can be triggered by various factors, including infections, environmental exposures, or progression of the underlying disease, leading to worsening of symptoms and decreased oxygen levels.

Pneumonia: Given the patient's compromised lung function due to ILD, they are more susceptible to infections such as pneumonia, which can significantly decrease oxygen levels.
Pulmonary Embolism (PE): Patients with ILD may have increased risk factors for PE, such as immobility or hypercoagulability, and PE can cause a sudden drop in oxygen saturation.
Acute Respiratory Distress Syndrome (ARDS): Although more severe, ARDS can be a complication of various conditions, including exacerbation of ILD, and is characterized by significant hypoxemia.

Pulmonary Hypertension: This can be a complication of chronic ILD and leads to right heart failure, which significantly impacts oxygenation and is critical not to miss due to its severe prognosis.
Cardiac Ischemia or Infarction: Decreased oxygen delivery to the heart can precipitate or worsen cardiac ischemia, which is critical to identify and treat promptly.
Anemia: Significant anemia can decrease oxygen delivery to tissues, exacerbating hypoxia in patients with ILD, and is easily treatable.

Venous-Thromboembolism (VTE) with Pulmonary Infarction: While less common, pulmonary infarction due to VTE can cause severe hypoxia and is important to consider, especially in patients with risk factors for VTE.
Lymphangitic Carcinomatosis: Metastatic disease to the lungs can cause hypoxia and mimic ILD; it's a rare but important consideration in the differential diagnosis.
Eosinophilic Pneumonia: This rare condition can cause hypoxia and may be considered in patients with ILD who do not respond to typical treatments or have atypical presentations.