Wet and stinky sand is not a good sign.
Ventilation certainly can be a big part of the issue. If you open the door to the henhouse and smell something bad (like ammonia) your ventilation is not good enough. In the PNW you can even have one wall completely open (with secure hardware cloth though for predator protection) as long as there is no draft on the birds. Cross ventilation is great if its higher than the birds when they roost.
Some other ways to figure it out is by the following:
What is the sq. footage of the henhouse?
How many chickens do you have using that house and are they standard size or bantams?
This is to determine if the house is big enough to handle the waste load.
Is your henhouse raised or is the sand directly on the ground? Is there a leak from somewhere?
If its on the ground it is more likely getting wet from the ground up as well as waste on top. Bad combination in the PNW. You may need to build a floor that is raised at least a foot off the ground. A leak is self explanatory.
Do they spend any time outside in the rainy weather? Is your run ( if you have one) covered?
Too much time in the henhouse increases the load of waste and moisture in the house. A covered run really helps keep a lot of moisture out and gives the chickens more space to move about in the open air.
I'd clean it out
and add a little food grade DE to the sand and mix it in. It may help some but you'll need to address other issues.
