I had an 89 STX with the 2.9 L engine and I use to tow my race car in an enclosed trailer at a combined weight of 3,500 lbs along with about 800 lbs on the bed. It towed it fine but the engine had to work hard on inclines. I had to shift down and keep it rev'd up to around 3,500 rpm or more to stay in the max power band. I had 4.10 gears with 31" tires and a manual transmission. I also had AAL springs plus rear helper air springs to keep the rear from sagging.
My longest round trip was 5,000 miles and did that several times. I could cruise up to 72 mph on the Interstates as the speed limit would permit. It would tend to get trailer whip occasionally if I went faster than 72. The most difficult part was making sure I did not stop on an incline because it was tough on the clutch to get it going again. Even on level ground it took some slipping of the clutch to get it going.
All in all, I felt that it handled it just fine until I got my current Ranger with the 4.0 SOHC engine. It sure is nice to have that extra torque for towing but the 2.9L engine will handle it.