The front ends do need attention in the 2nd gen Dodges. I have an '01 5.9 5spd (NV4500) ext cab short bed 4x4.
I've upgraded the trackbar in mine, added a steering box brace, and have done ball joints/unit bearings. Once done though, I haven't had a problem in 30k miles though some people claim otherwise. For a '99 there are write-ups to swap Ford outers onto it to get locking hubs back.
I have had other things go out (mine has ~125k miles) like the clutch master/slave, and the fan clutch. Just recently the CAD front axle (same as an XJ from 84-91 with part-time t-case) became finicky. They stopped using that in 2002.
As far as interior, I'm not a fan of the cloth seats in the 2nd gens (I have leather) but the cloth seats in my father's third gen are nice and comfy ('08). Almost all 2nd gens end up with a cracked dash which varies with intensity. Mine has two small cracks by the defroster vents that haven't gotten any worse so it doesn't bother me. Other than that I haven't had any issues.
Other than that, no issues. I've towed my rig and my buddies rig (separately) and average about 13-15 mpg with a 7k and a 10k trailer. Unloaded I can pull 20 mpg easily.
I wouldn't suggest 4 full sized adults could ride comfortably in my truck. 3 would be the max so the third has room to spread out in the back, it's hardly a full rear seat. I use it mostly for interior storage.
That being said, I'd probably still go with a 2nd gen, but try for a 2002 Sport ext cab short bed 4x4 5.9 NV5600 (6spd).