I'm not a professional painter, so take this with a "grain of salt". I have however painted my share of cars over the years and have always fought the dreaded "moisture problem". I've never had the money for a paint-booth or a refrigerated dryer, and since most all my painting was done in the hot humid summer months, getting clean compressed air was always a big problem.
30 years ago I only had a portable 20 gal Sears compressor that I used to paint cars and to run sanders and grinders. Needless to say the thing ran continuously and was overstressed most of the time. It generated a lot of water. So I plumbed in a 15ft 3/8coil air hose with 3/8" connectors from the compressor to a small transmission oil cooler. I also plumbed the moisture filter after the tramsmission cooler and it pretty much trapped most of the water.
In extremely humid conditions when I needed to paint a car I submerged the coiled air hose and transmission cooler in a 5 gal bucket of ice water. That condensed most all of the moisture which was then trapped by the moisture filter.
I also added a toilet paper filter closer to the gun. The following is an old Frantz toilet paper oil filter (Motorcraft makes similar units) that I modified to trap the last bit of water that might have managed to get past the moisture trap. The filter has been drilled and tapped to accept standard air couplers.
Lastly, a small inline particle filter was used on the spray gun air inlet
These steps have always provided perfectly clean dry air for my painting needs. Even in the most humid conditions. Total cost of the entire system -- coiled air hose, couplers, tranny cooler, used oil filter and particle filter -- about $50.
EDIT: Just to clarify, the cardboard tube in the TP roll (as shown in the pics) needs to be removed for this filter to work. I was test-fitting the role when this pic was taken.
(http://i357.photobucket.com/albums/oo18/goodfellow_2004/misc/PICT0001Medium.jpg)
(http://i357.photobucket.com/albums/oo18/goodfellow_2004/misc/PICT0002Medium.jpg)
(http://i357.photobucket.com/albums/oo18/goodfellow_2004/misc/PICT0003Medium.jpg)
(http://i357.photobucket.com/albums/oo18/goodfellow_2004/misc/PICT0004Medium.jpg)