Glad you posted this update.

That rear O2 sensor has no bearing on how well the engine runs. It simply reports cat efficiency. The front ones affect engine air/fuel ratio.

 

i had my cat cut out and a si/do glass pack put inbout 2 years ago and it made a world of difference too. Like you said it was like the truck couldna breathe. I'm still having problems towing and stuff. i think i'm going to change the o2 sensors this weekend. thanks

 

hmm sell it and get a 4.0L cause from my exp 3.0L have no power.. i have a friend with a 3.0L 2wd.. and yeah it had no ballzzz to it at all..

but i suppose you should just look into increasing flow and having your tranny looked at..

i have a 5speed 4.0 and i can tow anything.. i do it all winter towing people out of ditches.. people are amazed my truck can pull what it pulls.

 

punch the cat get a flowmaster muffler and have a muffler shop put it on.

 

dont gut the cat at all... bad idea.. if you think its exhaust related.. run high flow cats and for highest flow go borla or magnaflow.

 

i don't have much power and get bad milage. i have a 40 series flowmaster on a 2000/ 3.0 automatic and it has the same power pulling a 1500 lb. boat or without. i've had a 4.0 and you can't compare them. mine is a flex fuel truck so i think it must retard timming when using flex fuel. mine may be stuck in that mode. i'm tring to find out how to check it. i may have to ask that question on here. Lamar

 

Further Update:
I changed the front O2 sensors and it ran rich and the mileage was not great.Before I changed the fronts I got 15MPG pulling a 2200# trailer for about 850 miles. I changed the front O2 sensors and the mileage did not really change but my truck ran really rich. I just got the Walmart Fuel injector treatment and it made a HUGE difference in power and acceleration. This thing actually responds when i step on the gas now. Even up hill. It also helped the towing ability. I enjoy driving it.
It is like a new truck and it breathes beautifully. It is not like I have a 351, but compared to what it was, it is a rocket. It feels like it operates like it should. No more 3.slow.
Here is a list of the repairs/ maintenance I did:
New cat: $300
Cat Back: $150
3 O2 Sensors $140
K&N Filter $35
MAF Cleaner $7
Throttle Body Cleaner $7
Sea Foam $6
WalMart Special $20

Each step made an improvement but the final injector cleaning was the icing on the cake. I was ready to put my old O2 sensors back in because of the truck running rich. I did not want to plug my cat.

EDIT: Forgot: changed fuel filter after 12X,000 miles, doh! It helped