These comments are from our experience with an Epson 9890 running Sawgrass sublimation inks using the Wasatch RIP. This printer lost the light magenta channel in it's printhead - and we switched it to a 4 color printer, eliminating the light cyan and light magenta (we were using clear in the two light black channels). And, we got the similar results to what you are getting - we tried variable dots, fixed dots, different sized dots, different resolutions, etc. We then replaced the printhead and went back to C, M. Y. K. LC, LM and all was good again. The company that owns this printer sublimates onto metal, so the more course dot structure was very visible. But, if they were sublimating onto fabric, it would have been more than acceptable. The type of sublimation paper that you use also has a very significant effect on output - if you use a softer paper that doesn't hold the ink as precisely as a high release paper (that we were using for metal), it might minimize the effect of the dot pattern. Finally, I haven't heard of using distilled water in the unused channels - we always recommend
Lyson Absolute Clear and their refillable cartridges.
Epson's DyeSub F6070 dye-sub printer is only 4 colors, and Sawgrass sells solutions for the Epson T-Series printers that use C, M, Y and K. They also sell solutions for the 7890, 9890 and their description for these printers includes "Expanded Gamut and Smooth Gradients" because of the additional colors. So, if you are sublimating onto textiles, then 4 colors would be fine, if you are sublimating onto hard surfaces, then the additional colors will solve your problem. And, in our opinion, the Wasatch RIP is a great RIP - you get an unbelievable amount of control with it that you just can't find with any other RIP and you can get very accurate color reproduction. So, if you are doing sublimation, it is an incredible tool. If your are doing RGB photography, it's features are probably going to get in the way.