From Jim Harmon:
After attempting this with a NV3500, I would be very careful. The NV3500 can not handle more than 300 foot lbs. torque max. It will bind up badly and you will never get it right.
The NV4500 would be a good choice for this application. It bolts right up to the V8 and V6 engines, very tall first gear, 5.91, but the overdrive is still excellent. The best choice would be a 6 speed. This gives you the low end romp while still having the top end mileage and driveability. Make sure whatever transmission you use, that it can handle up to twice the horsepower and torque that you are putting out.
The 5 speed V8 computer will work fine (I have a 5 speed 97 PCM also available) as will the engine harness. The ABS/speedo sensor situation will have to be worked out since the newer Daks use the ABS wheel sensors for speedo calculation while the 97 used the actual gear in the extension housing.
You might want to try Blumenthals Heavy Duty in Oklahoma. They charge around $1400 for a NV4500 complete plus flywheel, clutch disc and pressure plate. You will also have to ream out the rear of the crank to fit the pilot bearing in it. Plus some time on the transmission tunnel with a ball peen hammer to allow fit of the trans and fab up custom trans mounts.
Otherwise, it should work. Just don't try the NV3500 5 speed. It cannot handle the power. Good luck.
From TonyC:
When I was initially working out the plans for my 98 5.2 Sport drivetrain upgrades, I was considering a swap to the NV4500. I have since decided on a worked 727 to handle the expected power output of my S/C 408 which will be used mainly at the dragstrip. But while the NV4500 was still a candidate for the project I spent some time on the phone with several of the guys at Blumenthal, both of whom were very knowledgeable/helpful, The standard NV3500 is rated for 350 ft/lbs, the NV4500 for 450 ft/lbs, etc. The NV4500 can be beefed up, and accessorized in several ways if you care to have them build you a unit. The input shafts can be upgraded to the V10 or the Cummins diesel part, both larger/heavier duty, but this will require a different clutch so that they fit the input shaft. Also several gera ratio sets are available, so you may be able to get a set that better suits you. Also note that the NV4500 is about 100 lbs heavier. The NV3500 slave cylinder will work, I was not able to positively determine if the shifters will use the same hole, but was able to determine that the NV3500 & Nv4500 use the same shift boots/holes on the Ram, so they will probably not require modification in that area.