HELP decals

I'm definitely not following on your problem.  It sounds like you did everything ok (although I'm not sure I'd use white glue on my decaling.  Did you slide the decal off the backing before attaching it to the model?  Maybe you could try the explanation again.  Are you suggesting that the markings have faded but it seems like you're saying you are looking through the backing material and seeing the decal underneath.  I've also see decals that were printed on the reverse side for things like instrument bezels but this doesn't appear to be that situation.  Fascinating!!

OK, in the pnt models directions, it states to spray a coat of gloss clear sealer over the model.  then to use a drop of white elmers glue, dissolved in water, to help fix the pnt water slide decals on the surface of the model.let dry, then spray a final coat of sealer ..... all was ok, till the final coat of sealer had dried. 

I then noticed that there was a white squair around the lettering.  the lettering is still clear, but there is that white film squair around the letters,  and i am too shakey to hand brush it away, the models i do are in 1-1000 scale

Without a picture I can't tell but it sounds like you're saying the decals were printed on white sheet instead of clear or that you have "silvering" ( where air gets between the clear part of a decal and the surface underneath ).

If it's the former, I really don't see any way to correct it other than painting over the white areas.

If it's silvering ( which seems more likely, since you didn't notice it until it was dry ) there may be some other way of fixing it, but I've caught it before the final dullcote stage and don't know how to fix it after that point.

the decal medium was clear

Its silvering.

Its when air gets trapped under the decal. 

I DONT know how to fix it once its dry but you should invest in some decal sollution/decal softener/decal blah blah blah.  You can get it from any hobby shop.  It disolves the decal a bit and allows it to contour to the kit perfectly and removes any silvering that might occur