Sorry, but still a newbie. I am confused as to how to aim correctly with the iron sights, is the front sight post supposed to be centered in the circle/rear sights? Or is there a different way?

Thanks

Zero your weapon with the small aperture.  Get your eye as close to the rear sight as comfortably possible!  I like to touch my nose to the charging handle as a reference.

As you said the tip of the front sight post should be centered in the rear app!  There are many zeroing procedures, however.  I zero my 20" AR's at 100 yrds, and my carbines at 50 yards, but there are more overly complex ways to zero!

Good Luck.

Heres a tip for you that might help you see a good sight picture.
In a well lit area, preferably out doors, aim the rifle into the air and sight through it as the guys said above.
while aiming into the air, you will notice a very faint grey or black "spot" in the middle of the rear aperature/ site, its an illusion created when your eye is trying to focus through the small aperature hole. This grey dot is the exact center of the rear aperature, put your front site on the spot and then aim at your target. This will train you to attain your site picture and you will develope a memory of it and it will become natural.
Remember this, in a proper site picture, your eye should focus on the front site post, the target and the rear aperature should be slightly blurred. Then just SQUEEEEEEEEEEEZE the trigger. X-Ring!!!!
cp out