Re: THC, the active ingredient
It DOES SO strengthen alcohol as the process gives you a stronger (more concentrated) alcohol (which almost universally refers to the solution rather than the actual ethanol chemical) then you had when you started. That's why some distillers do it more than once: each time gets you a higher concentration.
And yes, you can only distill to about 96% as you end up at what's called the azeotrope. Basically, the boiling point of 4% water is the same at that of 96% alcohol so you can't separate them that way anymore. It's relatively easy to obtain azeotropic alcohol. Getting pure 100% alcohol takes more complicated processes.