"Best year" is a relative term and depends on your personal views. I have an 03. Yes it's the dreaded LB7 with the injector problems. But it's also the only generation that doesn't have a bunch of EPA mandated emissions bullcrap on it.
To some of you that might not mean anything. To me it means that in the process of turning it into a fire breathing dragon I didn't have to spend a bunch of money eliminating EGR and DPF garbage. My truck looks like a grandpa truck from the outside. Bone stock, not even aftermarket wheels, no lift, nothing. The only clue to it's performance would be the 5" tailpipe.
For my purpose the LB7 is the best generation. The injector problem doesn't matter to me, first thing I did was yank the stock injectors in favor of 30% overs anyway. The injector problems were largely blamed on poor fuel filtering and lack of sulfer for lubrication in todays diesel fuel. I've added an Air Dog fuel preperator/lift pump that filters down to 2 microns instead of the stock filter's 7 micron. I also double filter my fuel by running a 2 micron CAT filter in (the CAT filters cost half the price of the stock ones and are a better filter) the stock location. I use an additive in my fuel to gain lubricity.
270K miles on it making big power and still running strong and pulling our 5th wheel around the mountains of Montana. I'm up against the limitations of the stock bottom end. If I turn it up much more it's just a matter of time before the connecting rods spontaneously disassemble themselves. I'll wait till I feel it's tired before I go into the engine to upgrade. Which I will do long before I buy a newer truck. This one is long paid for.
These are fun trucks. Research, pick the best generation for your intended use, then order up EFI-Live for some performance/economy gains. You won't be disappointed.