My friend has the RE 4" on her YJ. she did have to get the driveshaft lengthened even *with* the tcase drop. She could have driven with the stock shaft, but at full flex she risked pulling the shaft out of the tcase.
the tcase drop is more intended to lessen the angle of the driveshaft rather than help with its length. The short size of the Wranglers driveshaft and lifting it, makes for some steep angles. Steep angles are bad on ujoints.
I'd install the tcase drop or spend the extra bills and get yourself a SYE. As for the driveshaft length, just look at the slip yoke after the lift is installed. If it does need to be longer, there is nothing wrong with lengthening it (cost us $80) as opposed to buying a whole brand new one. The driveshaft shop replaces the entire tub on the shaft just using the old ends (yokes).
1995.5 Isuzu Rodeo - SAS'd and SOA'd, sitting on 36x12.50 TSLs, D44 front, 14bff rear, locked by OX and Detriot, suspensions by Jeep and Chevy, high steer conversion, 5.13 gearing and Teralow in the case.