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You have it back wards. The 223 @ the velocity you listed is devastating at close range. As the velocity drops under 2800 fps it loses much of it potency but is still plenty lethal.
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It is ok, it's not quite nearly as 'devastating' at close range as a .44 Magnum or 12 gauge shotgun, but an .223 AR is a good choice for home defense.
I've got mine loaded with 70 grain Speers, I've never seen any jello tests for it, but I've shot a few deer with it only in a .22-250. If someone takes a hit from it their hurt, bad.
I've seen the various penetration tests and any of the quality SP ammo available in .223 should definitely make a nice wound channel at HD ranges.