Cody is absolutely right, clean the sand out very well and get as much live rock as you can afford that's CURED. If you are going to get uncured LR then you should only put a little bit because it's going to smell bad. I know many reefers that use play sand and i plan on doing it on my next set-up.
Using ocean water is fine. I know many reefer that do this and they have no isses, but always pay attention to your area. If you live in Galviston, TX and you can't see your hand 1ft below the surface, you shouldn't use it.
Don't use crushed coral, or shells
. It traps detritus in and causes issues. Normally old tank syndrom settles in quicker if you use it, and that's never good.