You want a 3 to 4 inch substrate. I used all florida LS
because i could afford it and its a very natural and uniform look. Remember though just because it states Live Sand wont gaurantee its live at all. You could be buying reef sand thats been stored wrong or to long that will be void of most if not all life.
You could use play type sand and get great results.
And yes your sand bed is one of your best bio filters for converting ammonia and nitrate into harmless nitrgen but if conditions are wrong from amount and or water flow problems or feeding habits and or CUC stock or poor rock placement then your substrate will be your worst fear by collecting what it should be converting.