Hi. I'm not an all-grain expert but I think can answer some of your questions.
First of all, what you're doing with your grains is mashing, not sprouting. The sprouting is called malting and it's already happened by the time the grain gets to the LHBS.
Mashing is done at a specific temperature to accomplish specific things in terms of fermentability, flavor, body, and mouthfeel. Typically you will shoot for 150*F to 154*F depending on what style you are brewing. You want to heat your water to "strike temperature" - this is the 170*F you are referring to, but it varies depending on a lot of factors (the temperature of your mash tun, the temperature and amount of grain, etc). What you want to shoot for is that after you heat the strike water and add it to the grain in the mash tun, the whole shebang (the mash) will be at your target mash temperature (150-154ish depending) and stay there for the duration of the mash, typically 60 to 90 minutes (which is why your mash tun is most likely insulated). This is called an single infusion mash. There are other types of mashing you can do, like decoction mashing where you take some liquid out periodically and boil it and add it back to increase the temperature in steps. Stepped mashing (where you start at a certain temperature but increase or decrease the temperature at various intervals) can be used to accomplish very specific goals for the beer, but generally is not necessary with today's malts.
Lower mash temperatures (in the 140s) will get you a more fermentable wort, meaning a drier and thinner finished beer. Higher temperatures (up to 158 max) will get you a less fermentable wort, meaning a sweeter and thicker finished beer. Any higher than 158 and you are essentially starting to denature the enzymes that cause the mash to work, so everything extracted from there on out will be unfermentable and make your finished beer sweet. Some people do a "mash-out" at the end of the mash, where after all the starches have been converted, they raise the temperature up to the 160s or higher to denature the enzymes and extract some unfermentables that would otherwise be left in the grain. I don't know whether this is effective or necessary. Maybe someone will chime in.
After your 60-90 minute mash, you will drain the liquid from the mash tun. This is your first runnings and it is way stronger and less volume than you need. So you do a sparge. This is where you add more hot water (or cold water for some people, I dunno) to the mash tun to rinse all the residual sugar off the grains, and you drain it out to get second runnings. You can either repeatedly fill up the mash tun with sparge water and drain it (batch sparge) or continuously spray water over the top of the grain bed and let it continuously drain (fly or continuous sparge). That requires a bit more equipment but some people think it gets better efficiency (higher OG for amount of grain/water used). Again, I dunno.
Once you have mashed, drained and sparged you are ready to boil, and from there it's basically like extract brewing except you will need to add an extra 30-60 minutes or more to the front end of your boil time to get rid of DMS and get the volume down to where you want it for your batch.
So all told, AG takes maybe 3-4 hours longer than extract depending on your process. I can't really see a brew day being 12 hours long for one batch even with all grain, but maybe for people making huge batches it takes a lot of time to heat water and whatnot. I dunno.
To save time and equipment, some people do Brew-in-a-Bag (BIAB). This uses the boil kettle as the mash tun. You use a lot more mash water and contain the grain in a huge mesh bag. You control the heat either with insulation, by periodically adding hot water, or by periodically turning on the heat to keep the temperature where you want it. When you're done mashing, the wort is already in the kettle so you save time on draining. Typically you don't need to sparge with BIAB - you can just plan your recipe around lower mash efficiency - though many people do a sort of sparge by dunking the grain bag in another vessel of water and then combining that with the original wort, or by pouring water through the grain bag into the kettle as a kind of makeshift fly sparge. Either way, BIAB can save a considerable amount of time, and for that reason a lot of people do it even though they have the resources for traditional AG; some people even build BIAB rigs that are as expensive or more expensive than a traditional AG rig in order to boost their BIAB efficiency.
I have done BIAB and I thought it worked well. I am a cheapo so I've never done traditional all-grain, though I would personally rather do that than BIAB if I had the time and money. It seems like you have a fair amount of funding at your disposal for this project, so the choice is up to you. Personally, I am back to extract now because I simply don't have the time these days for an all-grain brew day.
Palmer's How To Brew (howtobrew.com) has a pretty good step-by-step for all grain. It's rather verbose on some things and glosses over others, but it's a good read for any brewer.
If you get BeerSmith ($20) you can construct a recipe and enter your equipment profiles. It will tell you what mash schedule you should use for a particular style, how much water, what temperatures, etc and pretty much plan out your whole brew day for you. For $20 I think it is an indispensable brewing tool.
