16" barrel is just fine for coyotes out to 500 yards as long as the rifle is shooting 0.5" to 1.5" MOA and your red dot is 2 MOA. Adding barrel length to a poor shooting rifle probably won't help much but if your rifle shoots good, adding even 200 fps provides very little in the overall scheme of things. Myself, I wouldn't do it unless I was going to do a complete make over and that does run into some serious cash.
I don't shoot much at 400/500 yards at coyotes and when I do, the bullet usually evaporates prior to reaching the coyote.
For the past year I was using the Burris XTR 1-8x24, which is a heavy brute - a couple weeks ago, I went back to the Aimpoint Micro with 2 MOA dot, seems much lighter and any coyote/fox coming within 40 to 300 yards usually goes to the fur buyer - those coyotes at 300 yards are sometimes hard to see, so if I miss, that is my excuse and I'm sticking to it.
My AR with my reloads can shoot 0.750" @100 yards with 5-shot groups using either 55 or 77 grain bullets and it has a 16" barrel, JP Trigger, Aimpoint Micro 2moa sight, usually just 4 or 5 rounds in the 10-round mag and sometimes an Atlas bipod up front, if I've got good elevation and shooting from a prone or table position, otherwise that bipod stays in the rifle case. In that configuration, my AR feels good in my hands and is nicely balanced when plowing through high grass covered in snow. I should add I don't shoot many 5-shot groups measuring 0.750" at 100 yards with a red dot - when I'm working up a load I use a 32X scope with BR crosshairs and know for sure what my rifle and load is capable of - when I shoot baseball sized groups, I know the cause. The 32X scope is a boosted Leupold 24X - used it when I thought it would help my groups while competing in BR matches - I don't think the scope made any difference but it seemed logical to me at the time.
A good scope is nice but adds weight, which comes into play when wading through snow and you're a senior citizen. If young and no snow - by all means, go with a good (read fairly expensive) scope, a small rangefinder, decoy, e-caller and whatever comfort items you want to hump in and make a dozen set-ups in a day located a half mile from your vehicle.
