Hello Dean
One way to tell if your brakes are dragging is to feel the brake hubs after a drive, if the are warm, that's ok, but hot means the shoes may not be releasing. How does the emergency brake feel? It should have some slack before it grabs. If it is tight right away, maybe back off the adjustment in the cable.
As far as the C223 engine getting 36 miles to the gallon, I wish either one of my Troopers did that well. Maybe when they were new the C223T (turbo) got better mileage than now with 100k plus milage. There is another thread here in the diesel section where we are talking about the injector pump timing after replacing the timing belt, maybe that is the ticket to improved performance.
Brian Rodgers