You are probably looking at around 100hp from your current engine in old and worn state as opposed to 160-170hp on a used 4.0 HO. I know they could new generate 190+ but you wil not get this unless you spend bucks on a rebuild.
That is one helluva step up in power.
Downside is that you will need the whole engine, fuel injection, wiring and computers to make that swap. the most difficult part for a home mechanic is the wiring, it is a mass of spaghetti and unless you have an affinity for that sort of stuff it could ruin your build. Some do and make it look easy.
Another route is a 4.0 head on carbs on a 4.2 block. Opinions vary but it could add 30-40hp on a 4.2. If you rebuild the block as well with new rings etc. you could be seeing 150hp+, maybe 160hp. It would not have the complexity of fuel injection and hence is fairly straightforward for a home mechanic.
If a 4.0 head with FI on a 4.2 block you could exceed the power levels of a 4.0HO. I say "could" as that will take some degree of skill but it is quite possible to use the 4.0 injection on a 4.2.
BagusJeep lives in Bali.
1981 CJ7 258ci - Bagusjeep
1984 CJ7 258ci - Puthijeep
1981 J20 258ci - Gladys
1951 Willys CJ3A/MB/M38 - Little Willy
1995 Cherokee 4.0 - CHEROKEE