The Holographic Sight actually increases the damage that the FAL does from all distances. This is great, because with the following setup:

FAL w/Holo Sight and Silencer
Bling
Stopping Power

the FAL is a SILENCED 2-hit kill from ANY distance. It's a counter-sniping monster. It also gets one-shot-kill headshots at close range.

I tried this last night, and it works like a charm. Usually the FAL loses at mid-to-long range to the countless auto/burst ARs, because you have to be so precise to put 3 shots into a guy from across the map. But 2 is pretty easy, especially when you're silenced and they don't know where the first one came from. Try it out.