I've read about people using a brass punch for moving the rear sight but I've heard that using a punch can crack the receiver and then you have a ruined rifle.
Fulton Armory sells a rear sight tool that drifts the rear sight and doesn't run the risk of damaging the receiver. It "clamps" on to the receiver of the rifle and drifts the rear sight with a brass headed screw. It runs a little under $100. It's almost enough to make you want to consider chancing it with the tap and brass punch.
Adjustable rear sights for the carbine are available on FultonArmory.com for something like $45. I just recently replaced the old one on mine with one they sold me and I have no complaints thus far.
EDIT: I should say that I did all this with a USGI Inland and not AO.
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