Well, it's a waterbased acrylic paint. I think that it's the acrylic factor (plastic suspended in water?) that allows it to adhere to acetate. Dang cool stuff, that!
I tried this on a card a week or two ago and discovered the same thing. I was hoping it would stick somehow. Darn. But I agree, on paper it was amazing! Note to self- use it BEFORE adhering paper to project because it will buckle a bit depending on the paper used.
Yes, if you use a lot of it, it will buckle because of the water. I think it is intended for thin coverage and then it is fine. I used it on my snowmen on my Christmas cards without incident but it was a very light coating.