WOW! Why would you want to do this? A 2000 is only 4 years old. I would bet that the laws in your area would not allow for this in the first place, but even if they did, you would be taking a major step back. In 2000 the 4.0l was a very good engine with lots of torque, reasonable MPG and clean burning.
An AMC 304 is an old school engine. You would have to use a Carb, or pay big money to adapt some kind of FI, the trans will not bolt up, the engine bay is too small, the cooling system not up to a 304.
With any amount of money anything is possible, but this would not be a wise choice.
If you must have a 304 in a Cherokee, go find a 84-86 with a blown 2.8l, there are tons of those to be had dirt cheap. Put the 304 in one of these. The amount of money involved will be the same, but you could sell your 2000 to someone that likes it as is.
I do not mean to make you sound dumb, or like your idea is bad, but more research on your part will show you that you would be throwing money into something that you could never recover.
A stock 2000 will be worth more than one modified with a 304. A 84-86 is already about as low as they will go. Anything done here will only improve their value.
Keep in mind that even a 84-86 will take a lot of mods and money.
Ask others too, I am sure they will chime in with good advice also.
Scott
87 Comanche
2.5l soon to be 4.0l
4x4