Yes, you should be good to dilute. Although I'm not sure about the "really solid" part of your post. Usually liquid soap paste is a firm, well, paste -- like really firm jam or soft gumdrops. So just to make sure -- you did use KOH, right? And what was your lye concentration and superfat?
The vaseline stage only means the soap has gotten warm enough to turn into a liquidy "gel" phase, as opposed to staying in solid form.
Gel during saponification is usually an indicator that saponification is going along fast enough to warm the soap up to cause this phase change. Soap can saponify without gelling, however, so gel not an absolute requirement for good soap.
And soap that has gone into gel and then cooled off isn't necessarily translucent. It depends on the fats, water content, etc.