Catherine,
If you have never been there, go to Wetwebmedia.com and do some research on Deep Sand Beds vs Shallow Sand beds.
Everything I have read says that sandbeds between 1/2" and 3" are just nutrient sinks and require constant cleaning.
Once you go past 3" you get the low oxygen Bacteria that remove the Nitrates.
From everything you have posted, I would bet you a fair amount of $ that your problem is your sand bed.
Regardless. Good Luck and I hope you can win the battle.
This is from Anthony Calfo:
The killing blow to a flawed application with course substrates in weakly circulated aquarium is the unfortunately popular employment of intermediate depths of sand at 1"-3" (25-75mm). In this mid range, the sand is often too deep to be wholly aerobic and yet not deep enough for efficient denitrifying faculties. As such, the two dominant (and desired!) biological populations are restricted if not excluded at large and the sand bed may become a dead zone... a nutrient sink. However, intermediate sand depths can be maintained successfully (often, in fact!), but require due diligence with regular sifting naturally or mechanically (by the aquarist or by creatures in the aquarium), strong water flow in the tank, realistic bio-loads, etc.
One more from Wet Web
<Well, one thing that I feel pretty strongly about is that you need to go 1/2 inch or less, or 3 inches or more. My thinking is that 1 inch is too shallow to foster denitrification, but too deep to be fully aerobic, which is a potential recipe for long term problems. If you're inclined to go this route, better to use a sprinkling of sand in the display, and a 3 inch plus bed in the sump...Modified Plan "D">
Now I will leave you alone
