If you have stock sized tires, 4.56 gears will probably bother you on
the highway as your engine RPM's will be too high - especially if you
don't tow very often. I've got 35" tires (with a 4L60E - OD and
locking converter) and I run 4.56 gears to bring the gear ratio back to
stock. I ran with a set of 4.88 gears for a while, and even with these
bigger tires and the 4spd trans, the RPMS were just too high. The
highest I'd go with stock tires would be 4.10, and even then that's
pushing the limit of reasonable.
As far as lockers go - I doubt you're going to break the DL, but you
may not be very happy with the locker on the street either. They are a
little clunky/noisy and may surprise you from time to time until you
pass the learning curve of how to survive with a DL. In your case, a
limited slip/posi-traction unit would probably work better. Leave the
DL to the guys that spend lots of time off-road, they need the traction
and can live with the negative aspects of the locker.
With a 2wd truck of that year, I'd think hard before spending several
thousand $$ on it. You just might end up spending as much as would
have cost you to get a newer truck. That being said.. I love my 1996
and have spent much more than it's street value in additional parts for
If you love the truck, drop a 383 crate engine in it, and either get
the trans done at the same time or plan on doing it shortly after when
it blows up on you. If that doesn't buy you enough push - then
consider getting the gears done as well. If you aren't that attached
to the truck, then price out a slightly newer 3/4 ton 4wd truck.