OKay, i've read a lot of different post on here and on the internet.
I'm going to be sanding my car down so I can get it primered and painted. My body is in pretty good condition, except for the hood where the paint is chipping off(something spilled on it).
So basically I need to sand the old paint off so I can get it primered. Using a random orbiting sander, is 180 grit okay to use? and how do I know when I should stop sanding?

you really don't have to sand the paint all the way off....just sand it to where it has a dull finish...NO shiney spots at all....

as said already you don't have to sand it all the way down to bare metal. all you have to do is sand untill all the factory orange peel is out or untill the old paint is completely dull. you can use 320 with a D/A. then your ready for primer.

Well wouldnt it depend on the condition of the factory paint? If the paint is cracking and peeling, then shouldnt he go down to factory primer?

Yes. If the paint is crappy, I'd sand it down to primer. And if the primer is bad...

so use a 320 grit with a random orbit sander? and sand until it looks dull... what about where the paint is chipping off(its not because the paint is bad just because some transmition fluid spilled on it)