Recently I was experimenting with bakers chocolate. I proceeded to add some butter and continued to mix until smooth. Afterwards, I added a small amount of whole milk and the chocolate didn't really change. Once I added more milk the consistency of the chocolate radically changed and became a lot smoother. Additionally the chocolate separated into two layers, what appeared to be a water layer and a very smooth chocolate layer.
Could someone explain what was going on? Why did the water layer form? Was it from the moisture in the milk? If I try this again, does anyone have a good method of removing the water layer?