I have done the first step by sealing the drywall using Cloverdale Paintís Latex Hi Hide Drywall Sealer for drywall or masonry. Now I need to lightly sand before starting the top coats.
After sanding do I need to tack cloth the walls or just blow them off using compressed air?
Do I sand between the 2nd and 3rd (last) coat?
Once you have done the final sanding on drywall, I don't understand why any furthere sanding is necessary. Did the instructions on your primer say to sand? You do not need to sand between topcoats. And why do you need two coats of topcoat? Most good wall paints will cover properly in one coat if you do it correctly.
As far as dust, any time you do sand, you must remove the dust before painting. Blowing with compressed air just spreads it around.