Battery powered sensor AC voltage drift

OK.

You can still run the ADC at 125kHz but the maths will take twice as long. See also About ATMEGA328P with 8Mhz internal oscillator crystal. Standalone

What is it you’re trying to measure? Real power? Do you want a steady reading, or an accurate reading? If you want an accurate measurement of Real power, you want those AC signals to be as undistorted from the original as possible.