This is another one I'm kinda surprised has taken so long to filter down to gaming modelers.
The purpose of "washing" the rubber in water is to accelerate curing by forcing moisture into the rubber (the curing process is hygroscopically triggered). Normally the putty cures slowly from the outside in because it's only getting moisture via air contact, but if you knead water directly into it, it cures faster and more evenly.
An alternative method is to mix powdered cornstarch into the caulk, which accelerates curing via moisture strapped in in the starch. See here:
http://www.instructables.com/id/How-To-Make-Your-Own-Sugru-Substitute/Washing the caulk gets you a thick thixotropic gel, while cornstarch gets you a Play-Dough or Silly-Putty like putty.
Silicone caulk can also be thinned with naphtha to achieve a brushable consistency. This also softens the resulting rubber, making it more pliable (but also more easily torn). Great for lay-up coats to ensure good detail and prevent air bubbles, but the naphtha makes the rubber "hot", so you can't do this on anything that's been primed or painted, or the rubber will bond to the primer/paint.
I've done the water washing and naphtha thinning things myself, but have yet to personally try the cornstarch thing. I'll admit I'm a little concerned that casting media might adhere to the cornstarch in the rubber.
In regards to casting materials...
Epoxy glue.
Not putty: glue. The sort that comes in double syringes or HDPE bottles. Epoxy is a resin too. You know this from putties like GS, Aves, MagicSculpt, Milliput etc. Epoxy glue is kinda like that, but in pourable form instead of putty form.
Unlike urethane or polyester resins, epoxy plays very well with water and alcohol, so you can not only color it with ordinary paints, but you can also mix in a little water or alcohol to make it flow easier. Main thing is that it does generate a lot of heat as it cures, so use the 20 minute to 2 hour types for casting, not the 2-5 minute types. Short cure time means more concentrated heat, which with small amounts can create air bubbles, and with large amounts can cause heat damage to molds (or you), or in really large amounts even catch fire. I once had a casting that was roughly a 2" by 4" cylinder boil like a pasta pot before solidifying, and that was with 45 minute epoxy! On the plus side, that heat fully cured it in about 10 minutes instead of 45, but it was still kinda scary, and the core of the finished casting was a sponge of large bubbles.
Anyway, you can crank out a lot of tiles and bits and things using just 15 bucks worth of caulk and epoxy glue, and once painted it'll look just as good as polyurethane stuff. The range of things you can make isn't as diverse as with polyurethane and proper mold rubber, but for stuff like floor and wall tiles you can do wonders.
If you want to try something really nifty, hit up beauty supply shops for two part acrylic resin (it's used for making fake finger nails). It's usually a powder and a liquid hardener that're sold separately. Mix the two together, and it hardens in just a couple minutes into a fairly tough plastic (a little brittle in really thin applications, like a figure's arm, say, but tough as iron in thicker ones, like figure bases) that takes detail well. Downsides are it's kinda expensive and very fumey, but it's super-cool to use.