The Sport is no different than any other AR in regards to the front sight and the decision to put an optic on it. I would recommend a scope vs. and EOTech although there is nothing wrong with the XPS2 (I run one on my shotgun). I say this because you mentioned grand kids and I know my 55+ year old eyes appreciated a magnified view when shooting longer distances.
You may have to put a riser on the between the rail and the sight....it depends on the type of mount and how high it sits. You'll want a good cheek weld regardless of it being an EOTech or some other type.
One other thing....I wouldn't classify your Sport as anything resembling a starter kind of AR. The Melonite coated barrel will give you many years of service and the lack of a dust cover isn't any issue....none of my bolt action rifles have dust covers and they've been reliably working for decades upon decades.
Here is a pic of my M&P15 in its current configuration. The best part about an AR is the near infinite ways you can customize it for your own needs.
