I've recently watched a YouTube video on an acoustic guitar maker using water-based lacquer finish using this stuff https://www.targetcoatings.com/produ...ction-lacquer/ - your Padico product is also a water based acrylic polymer emulsion. Here's the last in a series of 9 videos (most are of the man sanding the finish back in real time so not exactly exciting), but the finish looks really good to me.



So I'd just use the water based finish. Because you're not spraying it on, the finish will be less smooth as a result, so you'll need to use more coats to build up the thickness until you can sand it nice and flat (yes, more sanding!) but with still enough depth left to protect the wood.

Plus, because your varnish is acrylic based, it will react with a poly spray, so don't use a poly spray. If you used an acrylic lacquer spray, then all you would be doing is adding more of the same type of lacquer.

The important thing is to get it flat (you'd still have to do that with a sprayed finish but there would be less work). This is all wet sanding, so a lot easier than dry sanding. You need to sand the finish until there are no more glossy dimples in the finish. These are a lot easier to see if you hold the body up to a light at a 10° to 20° angle to the light. It can look OK if you shine the light directly down on it, so you need the light at a low angle to help highlight the high spots and put low spots in shadow. You can see the dimples and ripples in the finish in your test photos. You really want it to be mirror-flat.

Nothing too coarse for the sanding flat - you don't want to break through the finish by accident. I'd start with P320 wet 'n' dry paper, until most of the dimples had gone, and then move to P400 and sand with this until they're all gone. Use a wooden or plastic block for the flat areas. Then continue with light wet sanding, running up through the grades to maybe P1500 or P2000. The finish should then be ready for polishing.

The real secret of wet sanding is to let the wet 'n' dry paper soak in water for at least 12-24 hours. The paper becomes very soft, without loosing strength, and it then follows the body contours nicely, with much smoother results and is far less prone to taking more off the sharper edges/curves than the flat areas.