I can't say about the mpg because I didn't really care at the time and shortly after the lift and tires I added the comp, injectors, exh, intake, etc. But with that said I gained 3 mpg once it was all said and done, and I DON'T baby it. You will be happy with that setup. I get compliments about every time I leave the house.
You can fit a little larger tire with that lift but I like it with the 35s because you can go anywhere offroad without having to worry about rubbing.
My only advice is to determine how big you ultimately want to go so you do it right the first time. Just like any other mod, the coolness wears out after a short time. As much as I love it now, I'm already piecing together everything I need to run 39s for this time next year. I wish I would have gone with the SJ 7" or the DC 6", hind sight...