oneredbarn,
I've shot a few squirrels and several plastic bottles with my 223 using 40-45 grains bullets over a full load of trailboss. Muzzle velocity is 1800 to 1910 fps (less than hornet velocity). At that velocity, with target at 50 yards, I found that Sierra 45 gr SP, Sierra 40 gr HP, and Sierra 40 gr Hornet (round nose) were not explosive. Hornady 40 gr Vmax was still very explosive. All were minute-of-squirrel accurate. On squirrels, Vmax tears up more meat than I like. The pointy-tipped Sierra 45 SP doesn't tear up meat, but doesn't always anchor the squirrel a quickly as I like. I'm thinking a flat-nosed bullet like the Speer 46 gr 218 Bee bullet might be the ticket, sort of a WFN bullet for small game, but I haven't had time to try that out yet. (Currently trying to turn my 357 into a squirrel-getter instead.) Hope this helps, and best of luck. Let us know what you find. There are several of us out here hunting tree squirrels with down-loaded centerfires.
Duane