What the ketostix show is excess keotenes in the urine. Water dilutes the urine and make less keotenes per volume. Keotenes are used for energy, and this is why only excess keotenes are shown in urine. When you exercise, there are fewer excess and this can also lower the amount.

If any color is showing, then you are in ketosis. It's like saying the line on a pregnancy test isn't dark enough, so you should try to get more pragnant.

Keep up with the water. It flushes toxins from the system, keeps everything running smoothly, clears the skin and so on. If you are drinking a ton you might consider supplimenting with pottasium as electrolytes can be flushed form the system. A simple health fair blood teast can show your levels of electrolytes if you are concerned.