"Why distilled water when ordinary tap water will do?"
If you have some sort of Filtered water, and/or water softener system installed before your tap, then tap water is just fine (I would guess)
But, if you have the usual "unknown quality" of tap water that almost everyone gets, you don't know what is really coming out of there. Out here in the country, our water leaves white deposits on a pan's surface if you allow it to evaporate. (I did that on purpose when we first moved here, just for the info) It also stained the inside of Anne's tea kettle, until I got her a new one and switched her to bottled water for her tea. That means that is is in any modeling liquids that I create with our tap water. "Dirty water" is a major cause of stains on a model after you decal it. So, use any of the various "cleaned" waters from your local grocery store, and you eliminate a potential future "gotcha" in your modeling. This ignores the thought that no one has ever told me how modeling fluids interact with every possible impurity that might be in the water.
If you have a discerning palette, make a pot of coffee or your tea with bottled water sometime,,,if you taste a "better cup", then there is something in your tap water.
A gallon of water from Wal Mart lasts a long time at the modeling bench, and costs less than a dollar here in Middle Tennessee. (as long as the lady of the house doesn't need tea water in a pinch, lol)
Rex
Future and Golden's Medium are good ideas, too, there is such a thing as "thinning too far", that is after all, how we make washes, we overthin paint on purpose.