You have to have a mininum of 4 inches of lift to do this swap. I personally dont recommend running the factory jeep arms, its just much simpler to have two mounting points then four, not to mention that factory jeep arms arent adjustable and if you dont get the axle lined up perfectly the first time, theres no adjusting it unless you have adjustable arms. Above all I would just do long arms, just makes it simpler in the end.
As for gears, I should go with 4.10s (thats what the tire/gear calculator says) but since a 4.0 swap is more or less in the future, no real need to. A 2.9 only has 10hp then a 2.8 so the need for better gearing may be needed. Only thing with mine is high end speed,. has a hard time going up a long hill and trying to kep it doing 50mph, and thats in 3rd gear and foot to the floor!!!!
Hopefully I will be putting my CD player in tomorrow and get rid of my "factory" radio.