Thanks, Rick for posting a question I continually raise with others. Marty has been patient and responded to my questions twice. His explanation above is clear and concise; perhaps it will sink into my brain this time.
P.S. I, too, used the sanding sealer on a practice board I had carved – with the same result you had. I have been told by some carvers that the wood has to be a minimum of 1/4″ thick to avoid such warping. I have used sealer on wood 1″ inch thick with no warping but do not know how much lower you can go.