Hi Steve

I hear your frustration

and you're not the first person I know of who has had problems with a Wattyl's or Feast Watson's sanding sealer.

All I know is that I haven't had a problem but I've by circumstance have left it to cure for 6 or 7 days, so I can only conclude that a "light sand after 3 hours and re-coat" -- means the sealer will be cured enough after 3 hours to knock the nibs off before applying a second coat.

But that doesn't mean that it's cured enough to sand back to almost bare timber so that only the grain is filled.