1. Body lift (by itself); or spindle lift with blocks and/or add-a-leaf in the rear.
2. Figure 33's at the most. You're starting pretty far down with a base 4x2 instead of an Edge. Might have to settle for 32's -- but others can tell you for sure who have done it. Do a suspension and body lift and you might go higher. Pay attention to #3 below though: bigger tires really call for gearing change.
3. If you're willing to change your rear gearing, just about anything. However, even 31's will slow your 2.3 down. I put 31's on my daughters '98 2.5 liter and it's definitely slower in acceleration than it was with 28's or whatever was stock.
4. Yes, if you're going to offroad. My avatar looks like a capable 4x4, but actually it's a work in progress. I've been wheeling a 4x2 for years and for the last 2 years with a rear locker (Auburn ECTED). Sometimes folks I wheel with forget it's a 4x2 -- but it's no substitute for 4WD. Still, I've had a lot of fun and learned to drive it and got through a lot folks didn't think it could.
However, automatic lockers have issues if you like to throw your vehicle through turns under throttle. I suggest you save up for some kind of selectable locker if you're serious about wheeling a daily driver (as I am). It's worth it in the long run to preserve your street handling in my opinion.