In a normal situation, the sponge filter would have already been colonized with bacteria to keep the ammonia in check. Since this was an unexpected batch, which happens more often than you think, you have to improvise a bit.
At this point, start using Amquel+ to lock up the ammonia so it's not deadly. Continue siphoning the bottom of the fry tank to remove debris. I personally do not rinse the sponge filters more than once or twice a month - and when I do it's to squeeze them a few times in used tank water to free them of debris. Never clean them under the tap, or clean them TOO vigorously or you'll knock back the bacteria too much. I do try to siphon big pieces of debris, poop, etc off the sponge filters while I'm siphoning the bottom of the tank. But that's not always successful.
If you've already used an ammonia blocker such as Amquel, Ammo-Lock, etc it could be the ammonia reading you are getting is a "false positive" as they often times do that to test kits.
I use the Seachem Ammonia Alerts on my fry/juvie tanks. If the ammonia continues to test high and the fry are scratching, it may be best to do a huge water change. I have already done 100% water changes on the fry tank when they appeared to be acting "not normal", were scratching or just seemed lethargic. Sometimes the weakest ones did not handle the change well, but I lost very few the times I did 100% changes.
You will find you will go through gallons and gallons and gallons of water while attempting to raise fry. I probably remove a gallon of water each time I siphon the fry tank, which I do two to three times a day. Meaning, in a 10 gal tank they are getting upwards of a 30% water change per day. I do the same on the juvie tank. Between the fry/juvie tanks, bbs hatchers, unexpected water changes or additional siphoning I easily go through 40-50 gallons of water a week. I keep two 50 gal Rubbermaid Brute trashcans filled at all times. One has RO/DI water in it for freshwater top-offs and the other has the mixed saltwater at 1.021. I've learned to always be prepared and have water on hand for the unexpected.
Your biggest challenge for the next brood of fry... and yes, you will indeed have more fry
.... is to get a few sponge filters cycling NOW. Even if you don't need them for a month or two, imagine the bacteria that could be colonizing them during the next 8 weeks! I'm sure there are threads on how to cycle sponge filters on this website, and if not I know the one dedicated seahorse site
has quite a few. The biggest things to keep in mind for rearing fry are water quality, frequent feedings of bbs or enriched bbs, immaculately clean fry tanks.
As far as having 4 that look the strongest - that is a GOOD thing. Remember in the wild, it's something like 1 in 1,000 that survive to adulthood. And trust me, I think I've gone through 1,000+ fry until I've gotten to this point where I'm having some success.
This post is already too long and rambling, so I won't discuss my failures. Just know with each brood of fry it DOES get easier. As you gain experience and use what you've learned, it DOES get easier. Still frustrating at times, but a bit easier.
Tom