I have a 29g reef tank! I just put it up Saturday, I have 40lbs of live coral live sand mix! Over 30lbs of really good live rock that a buddy of mine gave me! It has a kinds of good stuff on it! Also has some hitchhikers on it looks like little starfish!
So both the rock and sand are from another tank correct , nitrates can be from the sand being disturbed , I would never reuse sand from another tank as a lot of times it causes more problems than it's worth as your finding out , high nitrates can also be exorbed into the rock , ammonia can be from die off on the rocks and sand as Cary said .
coral bandit has a good point also
Most people who screw up nitrate test get zero not a high number...
Wait it out like you plan but make sure you lower the nitrates before any stock.
give the tank a chance to cycle out than do a big water change and retest the next day, this should drop the nitrates , put a slanted plate on a flat plat so when adding water you don't disturb the sand again .
your looking for 0 ammonia , 0 nitrite 0 to 20 for a reef closer to 0 is best
hopefully this will level things out so you can add stock