What is this part and can I drive
 

it came off after i got pulled out and my jeep hasnt felt right since

Looks funky to me too, Best guess I can give is oil pressure sending unit... do you have a oil pressure gauge in your rig? Check and see if that is working.

The connector for the oil pressure sending unit maybe? If it is, I wouldn't think it would effect the way your XJ runs, just makes the oil pressure gauge work.

i have to let off the gas for it to shift into fourth and i think i have a vacuum leak,

yea its for the oil pressure

Yep, oil pressure sending unit. Other than the oil pressure gauge now reading 0 or MAX, it shouldn't effect how the engine runs unless it starts leaking.

ran mine for about 5 months with it broken off. but it eventually started leaking and i had to replace. cost 30$$