What is the difference between V2 and V2 sparse? I assume the only difference between V1 and V2 is that the files are compressed (a godsend, truly) in V2, but I am like Jon Snow when it comes to what Sparse is all about, and any other potential changes from V1 to V2 and/or Sparse.
For "sparse", xLights will generate a new FSEQ file specifically optimized for that FPP instance and only contains the channel data that it requires. For example, if your show has 200K channels, but that FPP instance only needs 10K channels for the stuff it outputs, then it will create an FSEQ file with only those 10K channels which should be significantly smaller and easier to process.
HOWEVER, the downside of sparse is that if you do something that requires that FPP instance to need a more of the channels, you will need to re-upload. For example, if you move a prop from one controller to another controller, the channel range may change and you would need to re-upload.