If you are near Houston, there is a shop in Bacliff that can do a regear for less than you were quoted. 4.88's would be great for 35's and ok for 37's.
As for the lift, why not the 2" Mopar lift. Less expensive and makes it easy to run 35's without needing a ladder to climb in.
For your...
I had the TSB done, and didn't notice much difference. It did fix the hot air problem. But I rarely run it in auto mode down here because I like driving with the windows down.
I turned the DRL off the same time I disabled ESS. And those who tell you that ESS won't activate with the AC on are wrong. I pull out of the driveway with the AC blasting and it's 95 and 90% humidity and the engine shuts off when I stop at the end of the block.
I yanked the main and aux batteries and replaced with dual battery configuration so I don't get stuck with a dead battery. The backup battery has been used a couple of times now. Never stranded.
M101A2 would be a better fit for the gladiator. replace the surge brake axle with electric brakes and the either keep the pintle or swap for something like the lock-n-roll hitch with a longer tongue for better maneuverability. I saw one here in houston that was converted and behind a JK...
Other options:
Keep the spare tire under the bed. Will fit up to 37" tire.
Replace bumper with something like the expedition one bumper with the swing-out tire carrier. Will support up to 38" tire.
I have had the death wobble a couple of times now. All with the same resolution. Re-torque the nuts for tie-rods, drag-link, and track bar. Mostly the tie-rod ends. They aluminum knuckles are too soft and the holes loosen up. Leading to the death wobble. I loctited the nuts this last time...
auto tranny. more reliable and higher tow rating than manual. The auto has a manual mode when needed. The manual has a history of clutch problems (overheating).
Wider axles come with rubicon and max tow.
Interesting, as I have the same problem O2 sensor problem on my 03 TJ. It doesn't want to go away and has been around for over a year now. Where do I find if there is a TSB for the '03 TJ's?
Get the Torque app for your phone and a bluetooth OBDII adapter. You can get everything except the oil pressure. Don't know why oil pressure isn't available but I can never get it on any of my OBDII devices.
I use a 67designs phone dock to view the phone while driving.