The 27 spline axle shaft in your rig is 1.19" in dia. The 29 spline in the 97+ 8.25 has a dia of 1.21. So with just thet bit more beef on the shaft plus more spline count makes an axle stronger. A lot of guys will say that the XJ Dana 44 is the end all bee all rear axle you "need" to have, or say the Explorer 8.8 with disks are the best cuz it has 31 splines, thus makes it stronger. All this is true, but it's splitting frog hairs to really find the best all around axle. The D44, 8.8, and the 29 spline 8.25 can all handle the same tire(with smart wheelin'). Make you choice on how you wheel, then choose what axle you need. If you do most of your trail wheelin' with the skinny pedel, maybe you need the best upgrade tou can buy. Buy if you wheel smart, choose good lines and buy better shafts, wjat ypu have will work out fine. But untill then, learn how to wheel stock, then modify as needed.
Make sure you do ALL the maintianace BEFORE you start doing any wheelin'. Many time POs do not service all the important things. Start with the axles, drive shafts, transfercase, linkages, transmission, MOTOR!!!! Sensors, i hope you get it. Also check the motor and trans mounts, they can lead to failures on the trail too.