My config is for urban combat where benchrest accuracy is not very useful. I have a 4 MOA Aimpoint Comp M3 on it where holding and standing after movement I can hit head sized target out to 50 super easy and chest sized target all the time at 100 yards. (SHTF gun). However, when benched on shooting bags filled with rice (long grain brown 30% and arborrio 70% with just a hint of cinnamon) I get about 2-3 MOA with a 4 MOA dot on the Aimpoint. With better optics I'm sure you'll get around 1.5. The gun is great. If the trigger was better I'm sure this could easily be improved upon. At 200 yards benched I get them on paper, but my 4 MOA dot is looking pretty big at that distance so I get a really wide spread.
However the gun was designed to be combat .223 so I think the Nikon scope is the wrong approach. Better get a ACOG or aimpoint. If you want to go target shooting for accuracy get a bolt action/scope.