Where are the brushmarks, are they on the wall or on wood, you mentioned undercoat, so normally undercoat is for wood.

If the brush marks are on the wall, then really sand the brush marks down, either by hand or use a sander.
if you think that if you sand too hard the existing paint will come off, then sand as much as you can without rubbing out the existing paint.

Then, get some powder filler, and just  skim over whats left of the brush marks, when dry, sand it down gently, then run your hand over over the filled bit, if you can still feel the indent of the brush mark, then do it again.

When you are happy that you cant feel or see the brushmark, and before you actually start rolling/painting the wall, get some diluted emulsion, or whatever colour your using, and brush that on the bit you have just filled.
Let it dry, and do it again.

This will stop the filler lifting onto your roller when you come to actually roll, plus, it will stop the filler flashing, (bleeding thru the coats of paint)

I would then for your first coat, providing its a good quality make, water the first down by about 20%, specially if you want a flatter appearance and not the orange peel effect.
With your second coat, I would still thin down by about 10-15%, reason being, you will get a really nice professional finish, plus the paint will go on better, and wont have the dragging effect.

Here is a tip...... When you do your final coat, do one wall at a time for a perfect finish.

I would still add a bit of water, do your cutting in top, bottom and sides, then roll the wall, then go onto the next.

Whatever you do, dont do the whole cutting in of the room, as you will get a patchy effect all the way thru.

After you have sorted out your brush marks, and you want to sand between coats, then just sand lightly, as all you want to do is to get rid of any nibs, dust etc that has landed on your wall whilst drying.

You dont need to sand like mad, you could use an old used bit of sandpaper, thats what I do, I dont have different grades, I keep bits of sandpaper, and the more used pieces I use for finer sanding, it works for me.