The Penguins are probably what is getting your nitrate readings up. By design they are supposed to be nitrate factories, with the thinking behind it being nitrate is safer than nitrite for your tank. Those filters are primarily designed for fresh water applications where nitrate levels can be higher. I think you will be better off removing those and replacing them with powerheads for water movement.
A sump is just a container of water lower than your tank. Water flows to it via a drain (external overflow, or internal overflow) and is pumped back to the tank via a return pump. The beauty of a sump is that the water level in your tank remains constant while the level fluctuates in the sump where it cannot be seen. A sump also allows you to hide equipment like your skimmer, heater, return pump, test probes, reactors, etc.
A refuge is basically any space where something (either pods for food, or macro for nutrient export/food) can grow without being hassled by the inhabitants of your tank. A refuge is commonly added to a sump so that it is hidden. You make a chamber in the sump and add a light (if growing macro). The macro sucks the nutrients out of the water in order to grow and you prune it from time to time to keep it in check. The algae you remove is full of nutrients/nitrates and by havesting it from the refuge you physically remove the nutrients/nitrates from the tank and promote the marco to keep growing which absorbs more nutrients. It does the same thing as carbon and other media, just more naturally and for the most part for free (less the cost of the light).
Several companies sell refuges that you can hang on the back or side of your tank if it is not reef ready (drilled with an overflow). You could also make one yourself pretty easy if you are good with acrylic. You just need it to sit a tiny bit higher than the tank and then have a small pump feed it and let it overflow back into the tank. Your fish/inverts/misc critters cannot get into the refuge to distrub the macro and it will pull excess nutrients from the tank.