When I changed my tank over, I removed the fish and housed them in an ice chest with some tank water and an air stone while I was working. If you have a separate tank you can put them in that has filtration, all the better. Some have had luck doing the changeover while the fish are in the tank but I chose not to go that route. Also, don't let your filtration dry out in the process. I left my filters full of water while they were turned off during the change.
Beyond that it was pretty straight forward. I removed the decorations and old substrate from the tank, and put my sand down. If you're going to use egg crate grid for keeping rocks stable, place it in before the sand. Once you get your rocks/decor back in place, you can fill the tank and turn on the filters after the sand has settled. You can also use whatever treatment to condition the water you would normally use, at this point. Be sure not to let sand get sucked into your filtration or you will find yourself replacing impellers soon.
Once I did all that, I let the tank clear up a bit for a few hours and I began putting my fish back.
Everyone will have their own methods of making a change like this, so it's important to take everyone's suggestions in mind when deciding what will work best for you.
I've read that the existing gravel will contain bacteria thats essential to the system. Could I maybe leave the sand in some stockings on the gravel in the tank for a few weeks to seed it and then change it over?
I don't see why not. In my case it wasn't necessary I suppose since I didn't have any unexpected issues as a result of the changeover, but it couldn't hurt. That was kind of the concept behind leaving the filters full of water, so that the bacteria in the filters wouldn't be harmed. But if there were no issues to worry about in your existing setup like parasites, etc.. I don't see the harm in a little extra precaution.
And DanniGirl is absolutely right; rinse your sand thoroughly. Never hurts to be safe.