I tried to water down the TIO&O for a few stamps as an experiment and I didn't like the outcome either. For the price of the glue, and the amount you use on a stamp, I wouldn't bother trying this again. If you have a thick layer of the TIO&O on your stamp it will be really sticky. I use my fingers to apply the glue and spread a really thin layer. Its really messy, but kind of fun too.
You can stick the stamp to your clothes or your skin a couple times first to take away some of the tackiness from the glue. It won't be quite the struggle then to get them to release from your storage sheets or blocks. I don't know about putting regular tacky glue on the back of the stamp first. I don't know what the purpose would be, but if it worked, great. The only thing I can think of is if they let the regular tacky glue dry first, then that would leave a smooth surface for the TIO&O. Just a guess though.