If you over-thin acrylic matt medium, it will dry with a frosty white finish. There needs to be a certain amount of the acrylic binder in the thinned solution to cover / coat all of the clear pigment particles, or the particles just stick to the surface and appear white.
It’s kind of like the effect of white snow. The individual snow flakes are really clear ice, but when piled up, they turn white. If you scoop a shovel full into a bucket of cold water, the snow turns into a clear mass.
At best, I’ve found artist matt medium can only be thinned down about 30% to get consistently clear results. At a thinning ration approaching 50-50 it’s common to start getting a white frosty look.
I use a lot of it as a light duty adhesive for small parts and diorama ground work, and I also add it to hobby acrylic paints, like Vallejo Model Color when thinning those paints for hand brushing. When used as a diorama texture / scatter adhesive, I don’t thin more than about 25-30%, and then I add a a flow aide / flow enhancer to mitigate beading up and as a wetting agent. As a light duty assembly adhesive, I use it straight. It works similarly to PVA but will dry dead flat. It’s also proof against most solvents, to include water, which will dissolve dried PVA and break the glue joint.
FWIW, I don’t use artist acrylic matt medium as a clear flat. (I personally use Testors Dull Coat, but if I was going to use an acrylic, I’d use a proprietary purpose formulated clear flat.) Artist acrylic matt medium, as a clear flat for art work is pretty much intended to use straight out of the bottle and brushed on.
There’s not a lot you can do to recover from the “frosty.” Sometimes a heavy re-coat over the frosty areas will consolidate the pigments and coat them into translucency, but that’s kind of iffy. You can also try coating with a gloss and then reapplying the clear flat. Success is not guaranteed. Still, it doesn’t hurt to try first. Neither of these methods will usually make things any worse.
Stripping and repainting is often the only surefire course of action. Sometimes it’s better to just hide with more weathering (as much as I hate to offer that as a possible solution).