The sand will need to settle a bit, but your water should clear up just fine ina day or 2. If you can, try running more mechanical filtration for a few days.
The alternate light cycle will help to stabilize pH while the display lights are off. The pH in the main tank tends to drop with the lights off, due to additioanl carbon dioxide build up. While this is typically not a large swing or anything to worry about, it is always better to keep i9t more stable.
As for the chaeto, it does not need 24/7 light. A lot of people who run other types of macro algae will run the lights 24/7 to keep the algae from "going sexual" (reproducing by offshooting spores) and fouling the tank. the 24/7 lights fool the algae into not reproducing. With chaeto there is very limited concern with this, so the alternate cycle should be fine.