LOL about seeing them and wanting them because theyre so cute. Most people think Im strange for thinking a crustacean is cute!!
Playsand is just fine for them. I keep mine in a mixture of sand from the hardware store ($4 for 50 lbs!) and coconut fiber. Its sold compressed in bricks for reptiles and it goes a long way. It goes by the brand name of Eco Earth. Originally I had mostly sand in the tank and just a section for that, but the crabbies eventually spread it out everywhere.
For now in the KK try to add some more sand so he can at least burrow down. They will feel safer underground and it lets them destress for a day or two after being moved. To keep the humidity in, you can cover the KK with saran wrap. I did this when I moved my crabs last month (humidity is about 0 here in the summer) and it worked well. You can mist the sand (NOT the crab–it stresses them out) to keep it moist but you dont want it wet. Only use dechlorinated water. Just like fish, chlorine will kill them.
Crabs will eat just about anything. At the moment mine are munching on fish, dried shrimp, seaweed and carrots. They just love apple slices and any fruit or veggie. I try to give them something different every night. A lot of the commercial crab food is not the best for them, and not all of them will eat it. Mine also love fish flakes and pellets (if the crab is small crush the pellets).
Do you have any extra shells for him? They always need extra shells because they like to change into one thats more comfy and larger as they grow. I try to always have a few shells per crab. Choose some that are similar to the one hes in now, but slightly larger. On the site I gave you there are pics of different shells that crabs prefer.
He shouldnt be stunted like a goldfish. Just try to get a larger tank as soon as you can, and also get him some friends. Despite the name they really are social creatures.

In the wild they live in groups of hundreds of crabs.