question about tamiya compound

Do I need to wet the cloth to use the compound or not? and do I need to do a lil sanding before attackin orange peel with the compound

You don't necessarily have to wet the cloth, but occasionally, you might want to moisten a bit.
Polish without sanding, then sand other area and polish it to compare both.
I believe the later will give more sheen on the surface, but just try and see it for yourself. Of orange peel isn't so bad, you might not have to sand.

thanx man..