A nitrate level of 5ppm is nothing. I dose nitrates to KEEP 5ppm for my
plants. Add several plants and you won't have a problem. IMO don't
worry about nitrates until they exceed 25ppm..... (IMO)

The ammonia? I've not had much experience with. I've had a slight touch
of ammonia once, but as far as I know there were no side effects.
Supposedly ammonia IS one of the more deadly parameters though.

Peat granules worked pretty well for my well water but if you use a
mixture of distilled water it'll bring hardness and pH levels down in a
hurry. I dunno if this will help, but my well water goes through a
cylce of nitrates and phosphates during the year. I have no idea what
causes it. Maybe it is fertilizers in the ground water, I dunno.

My Aquaria info & pics at:
http://www.geocities.com/spiral_72/Spirals_page.html