In terms of effect, Lunesta would produce the best sedative effects for falling asleep, similar to Ambien (zolpidem) and Sonata (zoleplon)
These are non-benzodiazepines, but still stand the chance of causing dependence and possibly tolerance over a longer period of time. In my experience, I felt that after a relatively short period, the effects began to be less clear. (This may not happen to everyone)
In terms of dry mouth, yes, this symptom may, and does arise often. Treatments include oral rinse, drinking lots of water, or possibly changing dose or medication all together.

In terms of Seroquel- in low doses the paradoxical 'sedating' effect arises due to that low dose widely affecting the histamine receptors, causing one to feel drowsy. As the dose increases, this effect also decreases.

Comparison of effect- Lunesta would be a better drug in the short term, giving definitive sedation to help one fall asleep, and only staying in the system for a few hours, allowing one to not be sleepy in the morning. This can help for initial treatment, or when you feel that your insomnia is exceptionally bad (some nights a week)
Seroquel 25 mg is often what is used, and this does not produce the tolerance or dependence that Lunesta may cause, and is therefore safer for use over months or years.