Yes, you need to stand back slightly to get your image into focus. Can't tell much of anything from your photo's. The white that you see could very well be the finish. If the can or gun is to close to the object being finished or there is moisture in your line then air will be trapped in the finish causing what is called blush. First off, are you sure that you are using L/B phenolic? Sure looks like delrin to me. You also must put centers on both ends of your base material and then make a pass so that the outer radius is the same all through the base material. In this way all of your inlays will be to the same depth when bored. If your base material is not delrin nor something else that cannot take a finish then the tube needs sanded a little better but use no finer grit than 320 or 400. When done sanding, use compressed air to remove as much sanding dust as possible and then clean with a prep. Some use Lacquer thinner, I, myself, use Prepsol wax wash and then let dry before applying a finish.
Dick