What Dana 35 setup? TTB or IFS. The Dana 35 ring and pinion doesn't seem to be an issue. The axle shafts, joints, hubs, wheel bearings, ball joints, and other parts seem to be the weak points.
I use 4x4 every day with two of my Dana 35 TTB trucks. One has 33x10.50 and the other had 33x10.50 and now has 35x10.50. To be honest ive never had an issue at all. Not only do I make the Dana 35 front end rotate those larger tires in 4x4 all day, but do that with 1,000-1,500lbs extra weight in the bed 90% of the time.
I Don't at all like the IFS dana 35 front ends 1998+. Ive tried using my 1999 for the same work as my 1997s and something always breaks. Nothing related to the ring and pinion, but I can always expect a shredded bushing, bad wheel bearing, junk plastic hubs popping off, or any other front end suspension related part. Ive bent a few control arms as well.