This is a really great thread. I've been toying with the idea of putting a small diesel engine in an S10 cuz I'm sure not gonna pay the crazy thousands that VW pickups go for on ebay.
I'd be very interested in your MPG numbers, according to my calculations I could get 40-50 MPG with the right diesel engine in my S-10 and tall enough gears to keep the engine around the torque peak at highway speeds.
I ran across the guy who put that Cummins in his Jeep while I was researching that Cummins B3.3 after I saw it in Diesel Progress. I was a little dishartend by his 30 MPG but after some more research I found that a Jeep's Frontal Area*Drag Coefficient is over 16 vs an S-10 at below 11. I think that fact alone shows that a 40 mpg S-10 is a real possibility.

The only problem is going to be height. Does anyone know what the dimensions of the old C223 Isuzu diesels were? What about power, torque and BSFC data?