I recently installed a 3" lift kit from Rusty's Offroad (
www.rustysoffroad.com). Great kit, reasonably easy to install, and at $418 plus shipping it was a steal -- that was for full replacement springs in the rear too!
Just installed BFG All-terrain 31x10.50 yesterday. It improved the overall ride of the vehicle, much more comfortable, much more stable. After looking at the steering I can tell I wouldn't get any larger tires under there without rubbing. (I don't have any at all right now.)
This is the way I would go if you're looking to lift. After all was said and done I got 3" in the front, 3.5" in the back, and it cost me roughly $1k.
Good luck!