Glossy or not, a smooth finish feels wonderful and protects better. Especially on something as abused as a table top. If those dust nibs you didn't sand out get knocked or scratched out at some point, it may result in a hole all the way down to the bare wood. Once moisture enters such a hole, well... you obviously have problems.
Assuming that convinces you to smooth out your finish, I think you'll get the best results if you apply in the direction of the grain, wait a day between coats, and always sand lightly with a fine grit in between.
Cue the TL;DR section.
Here's what works well for me. I like wiping on thinned varnishes for four reasons: it dries quicker, it's self-leveling as compared to full-strength, it wipes quickly without as much streaking, and cleanup is easier because you just let the rags dry and then toss them. Cleaning a brush involves solvents, gloves, a gooey sink, etc.
You can thin polyurethane 50/50 (or even a little more) with mineral spirits to make it easy to wipe. Minwax's Wipe-On Poly is also a good choice, though it's more expensive to buy pre-thinned. You need many more coats when applying it thinned, but the build is nicer in the end. A general rule of thumb is 3 coats thinned for every one you would have applied full-strength.
As far as 2 hours, I have little confidence in that... poly is usually tacky for quite a while (even if not obviously tacky to the touch). Thinning helps it dry faster, but it's safest to let it dry at least overnight. If you sand it before it's completely dry, marks will show up in the final result. Further, if the lower layer isn't completely dry and you seal it off with another layer, it will never completely dry (since it requires oxygen to cure). Ambient temperature and moisture in the air also affects curing time, but 24 hours is a safe bet in most climates.
Following the grain direction is a just-in-case technique that's useful to cover up application flaws. It's not necessary until the final coat, usually, but it certainly doesn't hurt to do it anyway. Especially if you don't have experience with brushing on varnishes; your technique is bound to be sloppy until you've done a few. This is not as much of a problem with wiping, but following the grain hides any streaking that might occur if your rag is too dry and you don't immediately notice. I always wipe in the direction of the grain on every coat because it's no extra work and I like to be on the safe side.
I love the feel of my finishes when I apply 3-6 thinned coats. After each coat, I wait a full 24 hours (I live in the cold, wet Northwest) and then sand lightly with 600 grit, remove the dust with a dry rag or vacuum brush, and do another coat. Sometimes I'll thin the top coat slightly more than the others, and then do a final sanding with 1500 or more so it hits any dust nibs but doesn't dull the finish. This regimen takes days of course, but if you have the patience your final product will be surprisingly smooth and appear very close to the wood.
Another rule of thumb: the more you sand the top coat, the more the finish will dull. This tip is useful if it comes out glossier than you wanted (#0000 steel wool or a super-high grit sandpaper is your best friend here). But to get in the ballpark, pick Satin if you want very little gloss and pick Gloss if you want more of a mirror look.
A caveat: this advice is based on oil-based poly and tight-grained woods; your mileage may vary if you're working on something with open pores (then you have to worry about wood fillers and other techniques for a smooth surface) or if you're using water-based poly (then you have to deal with grain-raising and all that).
A great book on finishing, if you're really interested in techniques, is Bob Flexner's "Understanding Wood Finishing: How to Select and Apply the Right Finish". One of the main themes is that the directions on finishing product containers are usually misleading at best. My comparatively limited experience has confirmed as much.