The hammer/trigger geometry is off, and that's why you're seeing the hammer move as you pull the trigger.
As for the sticky/spongy pull: That's a symptom of no case hardening or poor case hardening of the parts.
Most GI single stage triggers in AR's feel like crap. No matter what I do to them, they continue to feel like crap. About the only way to improve them is to put a set screw up under the back of the trigger to reduce engagement. Attempts to stone the hammer/trigger surfaces into a better surface usually result in the pathetically thin case hardening being removed, which gets you the "peanut butter trigger" effect as you expose the softer metal under the case.
If you're someone who appreciates a really good, clean trigger pull, you need to look at Geissle's products. I use a SAA for AR's that don't need adjustable triggers.