The best part is you can run the sponge filter in your established tank to keep it "cycled" or "seeded"... and then move it into the fry tank when you have fry... and move it back to the established tank when you don't...
yes, sponge filters do a good job of cleaning a fry tank. But with all sponge filters you will still need to do a weekly water change regardless. For my 40gal breeder tank, i run 2 XL sponge filter with a air pump big enough for a 60gal. Has worked well for me.
I believe the name of my sponge filter is hydra V.
For a fry tank there are several important factors.
Sponge filters are great and cheap. They also are easier to switch around.
Keep the tank bare. No substrate. If you want a few plastic plants thats ok, but no substrate.
Do daily water changes, or every other day--of 10-20% You will be amazed how much faster your growth is.
I also keep the temp a degree or two higher than the parent tanks. It helps accellerate growth.