I am rebuilding a '71 K5 and am going to put in a '95 9C1 350 "Interceptor" and it's matching 4L60E tranny.
~ The rear axle and differential are stock at this point ~

I'm going to be using as an occasional driver on the street (so I'd like reasonable mileage), but also want to be able to have fun in the sand as well as snow.
... and I'm not likely to be tow anything heavy / if at all.

As I understand it, that engine should have plenty of torque to spare.
The rear end most likely is a 3.73 ratio
and the trany has:
1st gear 3.059
2nd.......1.625
3rd .......1.0
od ...... 0.696

I'm thinking the axle is fine (vs. going 3/4ton or ..)
But was trying to figure out if it would be worth while to change my gear ratio to something closer to 4.56 range.

Would the stock 3.73 with that engine and trany have enough "off the line" power to move like I mean it?
... as well as maintain some reasonable gas mileage while rolling along at 65 / 70 MPH?

 

3.73s are pretty good all around gears. I've got them in my 88, and while I haven't actually tested them with my new 358, they did get me off the line with some pick-up with the stock 350.

Bumping up to 4.11s wouldn't hurt

What tire size are you planning on running? This plays a factor in the gearage also. if you want 35s or higher then you would need 4.11s or higher.

 

The choice of gears and axles really comes down to the tire size. If you expect to run 35+ tall tires and beat on it off-road with occasional on-road stints, then upgrading to 1-tons will definitely prolong the axle's life. 4.11's would also be a starting point with 35+ tires.

The 4L60E will give good off the line performance due to it's relatively low 1st gear. The part that could suffer though is cruising speed due to the overdrive gear, large tires (if planned), and gear ratio (if 3.73's).

 

Forgot tire size...
I have a set of 35's.

And off-road will mostly be sand / snow. Not a rock climber.