I haven't tried to put just a regular folding sight on my upper yet, as the talk was that the front sight was not compatible with a USA rear BUIS.  However there are a few youtube videos that show people with them, like a magpul and a standard carry handle rear.  They don't however seem comment on accuracy, just the over all function of the piston system itself.  Next begs the question, what is the extra front sight post that comes with the upper there for?  So, has anyone tried anything, and to what success?  I am going shooting again this week and plan on using a standard magpul folding rear just to see what happens.    
Anything to share?

I put the front sight that came in the plastic bag on my upper and pre set it a little higher and with a magpul pro sight I only had to go one click down to zero.

I zeroed at 50 yards. I had to put the extra ( bagged ) front site on the zero it. It is sticking up a good ways. Has a slight wobble. It did zero with it. The rifle was accurate and 100% reliable. No stoppages of any kind. I was shooting Radway Green  surplus . Yes I wish I had the correct height rear or Front sight block . WarDawg

Thanks for the responses.  I went out yesterday, used the taller sight post, and a regular magpul plastic rear.  Sighted in just fine.  I still want the Taiwan made rear.