You should definitely be getting better mileage than that, I have 33's and just went from stock 4.10 gearing to 4.88 gearing because I"m gonna be putting 35's on it next tire set. Anyway, I was getting 15-17mpg in the city. Mine's an '84.

As for the gears, ask what kind of gears they are. I got yukon gears, the best as far as I know. Don't go cheap on this. Find out if you have an 8" diff, I would imagine that you do, but just make sure.

The install is probably one of the more complicated things I've ever done, I had to order two specialized tools which I got off ebay for $125, an inch pound torque wrench and a dial caliper. Believe me, it's no simple process, but it can be done with lots of patience and a full toolset.

http://www.pirate4x4.com/articles/tech/billavista/Gear_Setup
Not your exact diff setup, but it'll give you a great idea of what's involved.
http://www.gearinstalls.com/
Very very helpful

No idea how much it is for a shop to do it.