Jackstand,
Fuel economy
I have only owned 1 four cylinder Ranger, it came with 25" rubber and 4:10's. It took everything in the world and my Grandma's skilled, feathering foot to get 18 mpg from it. That engine was supposed to get high 20's. I finally decided that it was because the gears were so tall.
Though my BII was set up the same exact way and performed the exact same way, 25" rubber with 4:10's and couldn't get it over 18 mpg...until I put 32's on it, then it would manage over 25 mpg on the highway???
My experience is different with the v6 Ranger though I am reluctant to offer it for this question specific. Instead I will offer a point of interest; I once owned a "dual purpose" motorcycle, it looked like a dirt bike but handled mire like a street bike. It could go 128 mph but felt like it was going to fall to pieces from a 6 six dropout.
The manufacturers tried to make one thing perform two tasks, it was because of this that I learned to build a vehicle to do one thing right and make it do it safely. I chose fuel economy in inclamate weather (sort of 2 things but it worked).
Since you aren't shooting for a trail wrangler, choose the tire size for your gears that keeps your engine in it's torque curve while driving, then you will experience maximum fuel economy. Since it is also using it's torque effectively, hills will not be an item of concern ..)
My '98 is 3.45 geared with 5-speed and I regularly get 26-27 mpg.
Tires are still the stock P205/75R14s that are supposed to be on it. Across the board, those tires are generally around 25" tall.
My truck is fuel injected, which can increase fuel mileage by around 15% (varies depending on your driving style), so if your Ranger was carbureted, it still should've been around 22-23 mpg.
Its interesting that the fuel mileage increase so much, by the change in tire size.
I suspect it could do with where the engines power peaks occurred at a given highway speed.
Seems you were spinning the engine way faster than it needed to be, thus the low fuel mileage.
Taller tires slowed your engine down and probably put it at a more efficient rpm.
That's IS a surprisingly dramatic change, though.
EDIT: Decided to do the math...Didn't include OD gear, because I don't know if your old truck has the same ratio as mine, so this was all calculated in 4th gear (1:1).
@ 60 with 25" tires, engine's turning 3306 rpm. With 32's, it's only 2583. A difference of 723 rpm.
That's quite a bit.
Essentially, the taller tires are making the engine think the truck's only going 46 7/8 mph.