It's not the tool per say. You have to have the right tool and the right product.
Here's what i use for " small scuffs, and minor paint correction.
http://www.amazon.com/32-oz-Menzern...GX54/ref=sr_1_5?ie=UTF8&qid=1320711050&sr=8-5
removes scratches as deep as 1000 - 2000 grit sandpaper would do. And 2000 is pretty thin.
There's another I use to take care of " spider scratches "
http://www.amazon.com/Menzerna-Supe...GRWA/ref=sr_1_3?ie=UTF8&qid=1320711050&sr=8-3
It's always nice and shiny when done. I don't have recent pics but here's a pic from 4 years ago after I clayed it, used menzerna 106, and waxed with meguiers NXT2