Sump set up - good chaeto home

I am thinking of placing chaeto in my sump.

Since I am limited with size of sump space (40g breeder), Can I place the chaeto in the middle section without any problems? I read how some people place it in a small spaghetti strainer and let it float.......In my mind, I think I want it in the middle section so it does not get in to the return pump. The skimmer section has very little room as well. SO I guess the only two sections that I can work with is the middle section where I have live/dry rock, then the return pump section is just that.

I do have an LED general purpose light above the sump, That should work, right?

Oh, another side note....tank just finished cycling and my QT inmates are awaiting the decrease of nitrates in the DT before I move them over. SO the DT is fishless at the moment
http://i804.photobucket.com/albums/yy321/crankbait09/fish tank/20151212_111907_zpsqzbimshi.jpg

Here are some pics of my sump set up

sump close up
http://i804.photobucket.com/albums/yy321/crankbait09/fish tank/20151212_105804_zpsc81bn5bj.jpg

overall sump area
http://i804.photobucket.com/albums/yy321/crankbait09/fish tank/20151212_105750_zpslokrgmsw.jpg
 
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The middle section is the preferred location for macro algae so that it does get sucked up into either the skimmer or return pump. I'm not sure of the color of your general purpose light, but macro algae grows best under lighting in the 5000 Kelvin range.
Your nitrates may never come down on their own; a large water change would be the best way to deal with them IMHO. If the ammonia and nitrites have dropped to zero and the fish have completed their quarantine period I would make a 50% water change and add the fish.
 
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