I just stripped and shot a poly layer on a squier neck's peghead, and then added a waterslide decal. Now when I painted a new layer the finish cracked and checked after a couple of seconds after I applied the layer. Why? Has it something to do with the can saying "overpaintable after 15 mins or first after 7 days"?

Ouch! Sounds like you missed the window.

I had this happen once with Finnegan's Hammerite (except that's something like 1/2 hour & then wait 6 weeks!), & learned the hard way that you disregard the manufacturer's instructions at your peril.

You could try leaving it for a week & cutting it back with fine wet & dry, then re-apply the decal & giving it another coat - but there's a possibility that the lacquer's integrity has now been damaged and further nasties (like crazing, cracking & peeling) could occur.

Safest solution is to put it down to experience & start again. PITA I know, but we all do something like this once in a while.

Pete.