You can't convert to manual hubs with your transfer case; there is no mode in which the front driveshaft isn't being powered by the engine, and having unlocked hubs in 4Hi-Normal mode would burn up the viscous coupler in your NP219 transfer case (a $350 item, when you find one).
It will have the D44 front axle and the AMC20 rear axle with one-piece axles and bigger tubes than the weaker units used on CJ's. Gearing will be either 2.73's or 3.31's.
It has an AMC 360ci V-8, which is completely different from the Dodge 360ci V-8 (though they do share the same specs for lifters, so those interchange). But no, you'd have to go with another '72-'91 AMC V-8, which includes 304's, 360's and 401's.
* '78 Cherokee 4-door "S"
* '88 Grand Wagoneer
* '84 XJ Cherokee 2-door FOR SALE- $600
All that and more on the page below:
<a href="http://home.off-road.com/~wagoneer/" target="_blank">http://home.off-road.com/~wagoneer/</a>