Which side of luan/underlayment to use?

[DaBearSox]

Does it matter which side I use as the exterior? Planning on sealing with 3 coats of CPES and then using varnish for UV. Attached are some pictures of each side. I like the non knotted grain better.

[MtnDon]

The second photo, the non knotted side is the good side. When using as intended, say as a vinyl floor underlayment that is the side that goes up. It is the side I used as the visible side on the interior of out CTC. It is what I would use as the exterior, visible side on a TD.