Bronc76, you're still going to have to tell us just what kind of driving experience you expect. I know you gave a lot of good info (more than most that pose this question in fact) and are honest about what it's going to do most of the time.
But it's not the garage living or the fact that it's going to be on city streets AND the freeway. It's what you expect it to deliver in each case.
Cruising down the freeway at an easy lope would be totally different than stoplight-to-stoplight response. Being able to rapidly accelerate at any speed and cruising along with big tires is not likely going to be anything but a compromise of one or the other. And, like was mentioned, just how is the engine built? Exactly? In other words, What cam? What exhaust? What mods (if any) to the transmission?
And what are your driving habits? How exactly do you drive around town? You like to just plonk along, or do you expect it to get out of it's own way at lights? What do you actually LIKE a vehicle to do on the freeway? Cruise easily at lower rpms or be able to get out of it's own way when you push the go-pedal?
They're likely going to be mutually exclusive in your case.
It's good that you don't have to strive for mileage, because a 5.5" lift and 36 inch anything tires is not going to get you there. Especially if your engine is rebuilt as basically stock. You'll be lucky to get into the 12 range. Ever!
So, with still a few questions still to be answered, I'll go out on a limb and say that, because you're running 36" tires and have a C4, I'd say to go with at least the 4.56 ratios. Even 4.88's if you want more stock-like performance around town and don't expect to go on long freeway trips, or don't mind a little higher rpm buzzing if you do.
It'll take it easier on the tranny as well.
TBS-POPS has a lot of experience and knows his stuff, so don't overlook his recommendation, in spite of what I say, but what I get from your description tells me you'll be happier with the lower gearing. Your automatic is certainly more forgiving of taller gearing, but I feel you're still losing some ooomph when getting the pig rolling.
Good luck. Take all the answers you get and wad them up and chew on them for awhile to get your answer.
Want to pick a ratio that I can be happy with and not second guess myself. Thanks.
Sorry, not going to happen.
See? You just can't get away from your previous decision to lift it and go with larger tires than Ford ever thought would go on to their little wagon. You're going to deal with enough of a range of ratios and mulitple opinions from us that you will likely always second-guess your final decision.
Have fun either way though.
Paul