I don't know about bullshitting you, but he was being less than clear.
There's a difference between "alcohol based" makeup and "alcohol activated" makeup. "Alcohol based" merely means that the solvent used in the makeup happens to be alcohol. It's true that you can use rubbing alcohol to apply water-based moist cake makeups like Kryolan Aquacolor. However, doing so does nothing to increase their holding power. The benefit you get is that the alcohol dries faster than water. This can be particularly useful in applications like airbrushing (so long as there is plenty of ventilation and no open flames or electric heaters nearby).
"Alcohol Activated" means that the makeup will only dissolve in alcohol (technically, other stronger solvents also work, but you wouldn't want to apply those solvents to the skin).
If you take a cake of good AA makeup and drip water onto it, the water will just sit there. You can brush it about, and it'll have about as much effect as trying to use water to dissolve a hunk of plastic.
I've used AA makeups where even 90% isoproyl rubbing alcohol did almost nothing to dissolve the makeup. You really need to use 96% at the minimum, but 99% or the specialty gel solvent is far more effective.
Oh, and I've never heard the term "wax paint" before. The closest term would be "greasepaint". While greasepaint does often contain waxes, it isn't used with a solvent. You just rub it on, and set it with face powder. Water doesn't mix with it in the least, alcohol would barely mix with it, and again, the solvents that do mix with it (e.g. mineral spirits, toluene, xylene) shouldn't be used on the skin.