As stated the trans will NOT bolt up. The mounts will need to be fabricated. The wire harnesses will need to be mated with eachother. A custom flex plate will have to be built. A adapter for engine to trans will have to be machined.
Prob a total of 1500-2500 in custom parts to stuff that motor in a jeep.
Or just pick up a good used 4.0 for around 200-400 bucks.... your call

 

I am fortunate to have a good friend that inherited/expanded onto his dad's personal machine shop. Some of his equipment is home made but tight and accurate. He is quite certain we (he with me watching) can fab a plate to join the engine to Jeep trans and re-work a flex plate. I've promised my wife I would finish my 1955 IHC pickup before I tackle another project. I think I can have it finished by winter, I have been doing a frame-off restoration on it. If I still have the notion to swap the 3.5 in at that time I'll take lots of pics. I think it sounds like a fun challenge.

 

I just realized that this might be a bit easier than originally thought...

The Dodge Magnum, Charger, and Chrysler 300 base models have a 2.7 (or 3.5 depending on model) that shares the same bellhousing pattern as your 3.5. The transmission is rather short and has a fixed yoke. Hunt yourself up a divorced Ford NP205 transfer case and have your machinest buddy make you a coupler to connect the transmission to the transfer case. Build a corssmember to hold the transmission and a crossmember to hold the transfer case Make/have made a pair of driveshafts. build some engine mounts, wire it up, and hook up cooling hoses.

I really don't think this would be a bad swap. Labor wise or end product. You would end up with an XJ that would get better fuel economy and have nearly the same power. You said this isn't really an offroad rig, so I don't see any downfalls.

 

So, are you going to do it?

 

You should do it, I think we all want to see it, at this point.