Here's my method: depending upon severity of crazing, you may opt to start with a finer grit.
Always clean thoroughly the surface before sanding and in-between steps, changing grit, etc.
Make certain you tape-off the paint and rubber seals. Popping the hood can reduce the risk of marring and facilitate reach of certain otherwise inaccessible sections of the lens. It is a good idea to have a large cotton drop-cloth to cover the engine. If this is cost prohibitive, 3-5 yards of plain-weave cotton fabric from your local craft store or supermarket will suffice.
For heavily damaged lenses, I begin by wet-sanding with 600-grit. Start off with moderate pressure, and keep a constant stream of water from a hose or spray bottle on the lens gradually reduce pressure until the yellow haze disappears, then continue with a higher grit. The headlight should appear completely white.
Then, I use 800-grit with moderate pressure, reducing gradually to light pressure. Check the surface periodically until the coarse grooves from the 600-grit are no longer visible.
Then carry on in the same manner using 1000, (1500 (if you feel it's necessary, but I find it superfluous in most cases)) 2000, then 3500.
Hopefully you have a machine. I usually use a rotary with a wool pad. (yes, I live dangerously.)
Then polish the headlight as if you were doing a paint correction. Coarse to medium-cut compound followed up with a glaze.
Don't forget to apply and maintain a plastic-safe sealant such as Diamondite clear plastic liquid armor.
Hope I was able to help someone with this verbose monstrosity.
