More feedback:
Mine is a 98 4.0/AW4, with 3.55s and 31" BFG-ATs.
Around town, its fine. Its a touch sluggish feeling right off the line(well, I've' had two other stock XJs, so a little sluggish in comparison, anyway).
Once driving, it doesn't feel bad at all. Does shift a bit more than I'd like on inclines when I'm loping around 55-60 mph or so.
I just did some decent snow wheeling with it. When the snow was 12+" deep, there were times that was straining a bit to rev up/spin the tires. Downshifting a gear took care of things..
Towing, I tow occasionaly with it, utility trailer type towing.
Towing my Flatfender (Stock 53 CJ-3a, so about 2100 lbs) wasn't an issue, seemed just fine for acceleration. Once towing with a tow bar, the other time with a heavy U-haul tow dolly. I could feel the extra weight of the dolly. Braking was a bigger concern than acceleration, for sure.
Towing the utility trailer is no probably, loads up to maybe 2000lbs.
Overall, I would like to go to 4.10s as well. The AW4 has such a nice deep overdrive, I see no reason not to. Its roughly the same RPMs as the AX-15 with 3.73 gears.
I'd probably swap out my 8.25 for a Ford 8.8 with factory 4.10s and then just regear the front. Probably could end up with the stronge raxle and disc brakes, and a factory LSD for roughly the same price as buying and installing gears.