unwrapping

I think Im losing the plot. We are still struggling with sleeping. Coco will go to sleep at about 8pm and then wakes anywhere between 11-1.15am. I then feed and she is not fed again until after 6am. This does not mean there's not alot of movement and noise and waking from her inbetween. What I want to do is start to let her arms out of the wrap. I am just worried that she'll distract herself too much. At the moment she spends half the night trying to unwrap. But unwrapped she loves sucking her fists, so Im thinking she might keep herself awake.
Also I bought a grobag, should I put her in this? I just want to hear of others who have undergone this transition and if it was successful. Coco is three months (today)!!
thanks xoox

We stopped wrapping Jacob when he was 4w old - he always got his arms out no matter what we did, so we just went with that. He had a sleeping bag too and he wasn't distracted at all by his hands.

I think its unlikely that sucking her fists will keep Coco awake. it may even be a self-soothing mechanism which will help her to sleep more soundly.