is this a show/display tank? if not, you could hang the filter on the front (HOTF ). my growouts are in the basement and i don't care about the ugly filter box showing. whether it fits will depend on what type of top is on the tank. with a glass top i put the plastic spacer on the front.
with 1" fry you should be changing lots of water daily so it may not be so much of an issue for now. you could add another sponge filter/air supply. i have never used internal filters so not sure about the flow, but if the internal is too strong for the fry then HOTB/canister/wet-dry may be too strong as well.