Before:


After:

 

Looks like you left behind a ton of sanding/compounding marks...gotta finish those down then you'll be good.

What was your process?

 

looks like he used the 3m Headlight restore kit, Same thing happend to me. My Drill has a bent shaft so I had to limit the speed or it would wobble all over the place. I think the OP did not give full beans to his drill either. you need 1000 rpm for the 3m kit to work out well.

 

Used Meguiar's Headlight Restoration Kit and I think it worked pretty well. I know its not perfect, but i'll work on that next time.
Just cleaned the headlights, taped up around them with (US Mail seal things haha). Used a regular drill with the pad attachment that comes with the kit. Whole process took about 15-20 min. I'll post more pictures when I do it next time to try and make it as perfect as I can.

 

What grit paper should I use when wet sanding my headlights. It looks like the entire light is a scuff mark.

 

You need to go down to like 2000, or 1500 and then use a polish I believe.

 

Big improvement, but still got a little work to do. I find a power polisher with a medium-cut polish works pretty well, too, though in the OP's case they looked pretty rough at the start.

 

just did mine last week, they were bad..i had to use 1000 grit & wet sand then used 3m superduty compound to buff out all the scratches...Looks like New!

 

Anything OTC will give you better results. Sanding then polishing is the only was to make them look as good as new