Sorry for the late replies, kinda sidetracked here with some friends.
Dan, yea, it's some type of Euphyilla (like a frogspawn-type LPS). Some stores sell a "Octopus Coral" that looks almost like it, but this one has really fat tentacles. I find this link,
http://www2.aims.gov.au/coralsearch/html/401-500/Species pages/419.htm (esp. that third pic), which talks about my type, and inside the link to divisa, is the more common one I believe.
P. Penguins, I've had the sponge close to three months now. Yes, you would be correct in the difficult part being not letting it touch air. I wouldn't doubt an item for sale probably saw 3-4 holding tanks before a LFS got the sponge. So there's a pretty high risk chance. However, I think they're more worth the chance, plus they are super easy to monitor, you seen some white skeleton, it's time to pull it or a trim. I had to trim mine, whoever collected it, smashed the base up pretty good. As far as care, I like to 'think' I feed it, shot some 5-300 micron phyto-feast.
engine, I have a couple different types of caulerpa, I'm not really sure of their specific name, but some sawblade, some grape, and some "coin-link" in there. I also have "live sheet algae" in there, plus a frag or two of xenia. I went with calupera instead of cheato, because I tried a really nice football sized ball of cheato I got from a local member, and it did nothing but slowly die and disintegrate.