I can't be sure from the photo, but it looks like your stitches are fuzzy. Are you using waxed thread?
The inside or flesh side can be made smooth using some gum tragacanth and slicker. I'd recommend trying to slick the inside if you find your projects starting to flake or get too ragged. If you end up with a really ragged piece you can also trim the flesh side and use sandpaper on it before slicking it.