1994 F-350 Keep and do some work, or sell to get something newer...

I currently own a 1994 F-350 (7.5L) with 101K miles on it.  It has been a very good truck overall.  It has an 8 inch suspension lift and 2 inch body lift with 38x15 inch tires.  I don't do any serious rock crawling type stuff, but I use it to get in and out of my cabin and for hunting.  When I was a bit younger I could live with the short-comings of this outfit, because I liked the benefits.

I am older now with some poor joints in my hips and back.  The rough ride is miserable now.  The 9 mpg is a little tough to take.  It's a little too tall for most trailer towing (and I think the brakes are a little undersized for towing anyway).  It's about to need it's second transmission rebuild -- AOD tranny.

So now I finally get to my questions:  Are there any easy/reasonable options for engine and transmission swap for better MPG and some occasional towing; still want the 4-wheeling ability for the cabin and hunting.  Are there any real options for easing the ride up.  I don't need Cadillac, but farm tractor is too much for me anymore.

OR would I just be better off selling it and going for something a little newer?


Thank you for any help!