You must seal air-dry clays or they will be susceptible to water/moisture damage at least. If the clay items are temporary and will never be exposed to those things, that's different, but generally they're sealed. So if you use a non-permanent colorant like watercolor paints, you'll have to seal it after painting (though apply lightly and quickly) ...or you could mix a water-based colorant like that or a powdered pigment into a clear permanent finish** and use that to paint with which would make something like watercolors "permanent paints."
If you use a permanent paint to begin with, you will have sealed the clay automatically (as long as you get complete coverage and all over). One permanent paint would be acrylic paint, and if you want it thinner you can add water or one of the clear "acrylic mediums" to it (those are sold to change the properties of acrylic paints but not their color unless too much is added)...one of those acrylic mediums should be for making them thinner in particular. If you add enough water to acrylic paint, you'll turn it into a translucent "wash" which will be quite thin but not a strong or opaque color.
Water-based paints and finishes and mediums won't cause most air-dry clays to "crumble" because you'll just be applying them to the exterior and doing that fairly quickly (and they dry fairly quickly). If you saturated the clay and did it for awhile, you might get some deforming of the clay shape in that area. If you're concerned, you could also use a clear acrylic spray (or "artists fixative" spary or perhaps even hair spray) to add a very light coat of "sealer" on the clay.
Acrylic paints come in various qualities and types too. The cheaper "craft" acrylics in little bottles, etc, are usually thinner and less opaque than the "artist" quality acrylics that often come in tubes (or jars). If you're just wanting to put a wash on your trunk though to color it "a bit" and to make it more dimensional and real looking by being darker in the depressed areas, just use one of the thinner options above.
Or you can paint the trunk first (thinly), then do a wash of a darker color on top to add dimensionality. http://answers.yahoo.com/question/index?...
Don't use water colors, it'll mix with the clay. Use acrylic, that will work better. Good luck!
Then you could try mixing the acrylic with some water to make it a little thinner- either that or make a sample and paint over it to see what would happen.
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