My buddy has a 3.5" procomp lift for his 98 ZJ. I know the rear would be different, but that 3.5" performs GREAT offroad, and it's on road ride/handling is good. His lift came with front upper and lower control arms with adjustable cams so that he can still get it aligned. The spring/shock combo was a perfect selection for the zj. It's a hair stiff on road which helps keep sway under control but a little soft offroad in the high speed stuff but still flexes well.
I think procomp sells a 3.5 XJ kit with rear springs.
If it were my XJ, I would get a 3.5" front lift from procomp and 3.5" RE rear springs.