David nailed it on the head, but I'll share my experiences...
I recently wetsanded a few things - a set of Porsche "telephone dial" wheels and a 1988 Porsche 944.
The wheels had just been painted (by yours truly) and had a very dry top coat of clear; they were very, very rough to the touch. I wetsanded them with 1500 grit, followed with 2000 grit. A hand application/rub down with some FI-II, followed with SMR and they were lookin' and feeling perfect.
The 944 was wetsanded with 1500 grit only (no follow-up), and then PC'd with a yellow foam pad and Perfect-It III. Worked like an absolute charm. We followed it up with SMR and GEPC - looked better than new...
So, to make a long story short - the PC can take out wetsanding marks, as long as you're wetsanding "correctly". There's very few things that the PC can't do - it just might not do them as fast as a rotary would, but I'll take that slower speed (and safety cushion) any day.