I have found using baby powder makes smoothing the surface of polymer clay easy.

Once sculpting is complete, you can brush the surface of the polymer clay piece with a soft paint brush dipped in baby powder, and buff off lightly with your fingers. This process will smooth out rough spots and imperfections, and leave a silky-smooth surface. This saves time on sanding after the piece has been cured. Do this ONLY when you're certain you're finished with the sculpting process, as it's impossible to add on more clay after it's done. And...this only works with the Caucasian skin tones. Don't try it on ethnic colors, as it leaves a white residue that's impossible to remove.

See Myra's work at Born Yesterday Dolls and in the ODACA Artist Directory.