How to determine if paint is sandable?
Primers sand well.  Oil based (alkyd) paints sand beautifully to a powder. Latex paints do not sand well in my opinion; they gum up.  I have not had experience with sanding flat latex products.  

There is a new product on the market that is a water-borne oil paint.  It cleans up with water but apparently levels nicely like 100% alkyd.  I don't know how it sands but it might be worth asking someone at a paint store.