2300 RPM is fine, so much smoother than 2800. The fuel mileage is much better around 2300 than 2800, too. After a 5-speed swap my car turns about 2000 RPM at 65 and it does alright, not much extra power, but it gets great fuel mileage. 4.88's would probably be a good choice for your application because you plan to run bigger tires, and you probably won't spend hours at a time on the highway.

Keep in mind this motor will lug under about 1500 RPM (in higher gears, in 1st or 2nd I can't really get mine to lug at all).

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dieseleverything

'95 E300D 279k 717.411 5-speed swap 40 MPG
'78 240D Turbo 144k
'83 240D 201k