The reason cc (crushed coral) is bad is because it is really good at storing garbage... that's basically the only thing cc does for you. Over time, you'll notice it kick up dust anytime there's surface movement. If you ever wanted to move your tank, you'd be risking the lives of your fish, because as the cc moves, all the garbage it has collected will resurface and cause an ammonia spike.
Live sand is much better because it absorbs the detritus (fish poop and uneaten food), and does an excellent job of filtering out the ammonia and nitrites. It also houses a lot of great detritus-eating pods and provides food for sand-sifting animals. Also, if you have cc, you can't put any sand sifting gobies in there otherwise they won't do well. You can't really put any sand sifting stuff in there because they won't be able to sift larger pieces like cc.
Ok, now that you've had the history lesson, here's what I would do...
I would transfer all the live rock and fish/etc to a bucket or something... just make sure there's swimming room and that all your live rock is fully submerged. Also, make sure you put a powerhead and heater in there because they'll need both. You should probably have a spare heater lying around when you do water changes anyway. Also, it's always good to have a spare powerhead lying around... you could get a cheap one from your LFS... I have a little $12 one that I use. I just throw it in there for some water flow and add the heater to keep them nice and comfortable.
the next thing I would do is take out the remaining tank water and KEEP the water... don't dump it.
Take out all your cc and replace it with live sand... the kind of live sand that comes in thick plastic bags filled with water.
Put everything back in.
You may or may not have an ammonia spike, but if you do, it will be very small. I have done this exact procedure with my daughters used 14gallon biocube and I didn't have any problems whatsoever, most importantly NO ammonia spike. I think if the only thing you change is the sand, you'll be alright... hopefully your live rock will absorb whatever die-off that comes from the live sand... because the sand comes live, I don't think there will be much, which is what gave me the confidence to do it, and what gives me even more confidence to post this advice.
However, this was for cc, not what you have in your tank. As others have said, it's clearly smaller than your run-of-the-mill cc. If you find yourself battling nitrates, then it's an issue you should probably take care of sooner than later.
Hope this helps!