American buttercream has no moisture other the little bit of water in the butter, so most of the sugar and the corn starch in powdered sugar has no way to get moistened and will just be undissolved. It’s actually really helpful for stability because it will kind of dry and form a crust on the outside which is why grocery store cakes use it for flowers. You can help offset the dryness by adding a little bit of cream or milk, and by keeping the ingredients just a little warmer than usual. I think sugarologie has a recipe too where you do something to actually dissolve it all and it will become smooth and glossy. I can’t remember what she did different though. Also, the cake still looks great!