The space between may be more of a product of how much space you need to do the assembly, than what you think would be ideal. Personally, I would want enough space to be able to clean in between. As to the use below water of silicone, it's primary use is an all weather caulk, not an adhesive or sealant for aquariums, hence the disclaimer.
Up here in Canada, we have several options of house brands that say aquarium safe on the label and are a little cheaper than the GE. The Home Hardware brand comes in at 3 tubes for $10. It is more likely to be a rebranded tube of GE I, than not (or possibly made by Dow). Regardless, I would be surprised if something similar isn't available in the US.
Join a fish club. Don't have one in your area? Start one.