I'm not sure what you mean here as your use of certain terminology is perhaps not quite correct.
Internal Focusing is generally used to describe a relatively new design feature where the entire focusing mechanism is enlosed/sealed in the binocular's optical barrels. Look at a Zeiss ClassiC binocular while someone is using them and as they move the focus wheel you will actually see the objective lens move back and forth. Do the same with a binocular of more modern design and you won't see any movement at all. This movement necessarily makes the older binocular difficult to seal to the same degree as more modern designs and makes the "nitrogen purging" that is so popular in advertisements today basically impossible. This however, has nothing to do with the clarity of the image, nor in fact does it make it impossible to have a "waterproof" binocular (as countless Zeiss ClassiC owners can attest.)
Perhaps you meant Individual Focus binoculars? In this case you are dealing with a binocular where each eyepeice is adjusted independently, ie no central focus wheel. This is still a "manual" adjustment and can certainly be just as precise and clear as any binocular with a central focus. The idea behind it is to adjust each optical barrel seperately and once they are each set to their respective eye, you (in theory) don't have to ever reset them. The major drawback to this system is that when you transition from looking at objects that are very far away to looking at objects that are relatively close, you do in fact have to readjust the eyepeices, which can be cumbersome.
What you call "manual" focus I presume is intended to describe the more common binocular design with a central focus wheel. With this design you still set each optical barrel to "match" the appropriate eye but then, as you transition from near to far objects (and vice versa) you simply turn the central wheel to bring things into proper focus. Some people complain that this design results in a narrower "depth of focus" which then necessitates almost constant movement of the center wheel to keep things in proper focus. I'm not sure this is true as my understanding has been that depth of focus is almost exclusively controlled by the magnification of the optic but, I could be mistaken.
Neither of these two designs have anything to do with the clarity of the image, except perhaps in cases where the user does not properly adjust the binocular in the first place. But, this would be user error, not design flaw that causes the poor image quality.
I only know of one binocular that was marketed as "focus free." This was made by the Simmons company and it was an absolute peice of trash.