My Old boss had a Mid 90's 6.5 turbo??, and he swore he could beat my cummins up a steep pass were I use to live???!!! Never did take him up on the race, tho I probably should have. I would say buy the burb and run it. Replace parts as nessasary and just drive it, Even if it nickel and dimes you,,,Its just nickel and dimes. Less pament than a new tahoe...Thats the way I figure with my 93 cummins.
As a kid growin up we had a early 80's 6.2 diesel suburbam. My old man use to rally that poor thing to no end...never had a big problem with it from what I remember...Just cause it aint a cummins doesnt meen its worthless... tho someday a swap could happen......

 

For $3,500? I wouldn't think twice! The "Burbans" usually weren't beat as hard as the trucks were. If you really feel like spending a weekend making a difference, when the Stanadyne DB4 (electronic) IP dies, replace it with a DB2 (mechanical). That's sorta like P-pumpin' a 24V.

 

If and when you replace the PMD remote mount it and with a 3.5" exhaust and mild chip you will love it. Just don't tow heavy. 96's should have had the twin thermostats, just keep the rad. clean and you'll be fine. Twogun