I had a good running 2.9 in mine...but it had a tired FM-145 behind it and it needed a clutch. I had just completed a solid axle swap in the front and an 8.8 swap in the rear, with 33" tires. I had 4.10 gears which were just barely adequate for that tire size on the highway, let alone offroad... I was either going one of two ways, a V8 swap that would gain me a real transmission with a granny low 1st gear, or a clutch replacement and much deeper gears in my axles. Either way was going to be $1000+. I opted for the V8. The engine, trans and t-case ended up costing me nothing after some careful buys and horse trading, but I definitely do have somewhere between $1000 and $2000 into a radiator, clutch, fans, and a lot of misc parts. Gears and install kits would have been $500-700 per axle plus some labor and additional cost for lockers... I stuck with the 4.10s which I still have, and am running 35" tires comfortably at this point.
I have no regrets either. The V8 has had plenty of stupid quirks but it's very reliable and is still running great after 10 years of merciless abuse.