It all comes down to how much work you want to do.
You can get more power and better mileage out of a domestic V8 swap, but it will be more work, and cost more.
The 3.4 is easy, and the SC is nice, but that all adds up cost wise as well.
I wouldn't worry much about the power. People get into trouble with big tires and lots of power. If it becomes an issue, d60's are easy enough to put in for a couple grand (on the high end by the time you get adapters and if you end up paying a normal yard price for the axles, cheaper if you find a deal) and will hold up to whatever you throw at them.
Hunt around for a deal. If you find a good V8 and computer with a tranny and transfer, go for it. If you find a 3.4, go for it. You have a first gen, it is very easy to rip it all out and start from scratch. Not much of a body computer and no ABS to deal with.
Baby Beast 2- 1999 4Runner SR5
Baby Beast -1987 4Runner SR5-Gone, but not forgotten