Today I went ahead and sanded the left headlight with 2000 grit horizontally and 3000 grit vertically.
I then used compound on a wool pad on the DA polisher.
These are the results.
I can say that there is huge improvement in the middle of my headlight. However there are loads of micro-scratches left most of which look like glitter and some like spider web lines. These seem to be limited to the area in front of the "inner light".
I also tested a bit of ppf to see if it can mask these hairline spider webs and I cannot say that it did. They were still visible. (will have to use distilled water when I do the installation).
In the meantime, I think I have more sanding to do tomorrow.
More details in the video - your input is appreciated.