Ford F350: Which motor?

Upgrading solely for mpg increase with the amount you drive is a losing proposition. But if you just want a new truck or looking for more power pretty much any newer motor will do the job just fine with a TC unless your also towing heavy behind it, then diesel. If you run high elevation mountain roads a lot a turbo diesel is much less affected by altitude and having an exhaust brake is nice. Also the lower rev in a diesel is nice. I have a 05 Dodge Ram 3500 diesel for my TC but use an 08 F350 5.4 gas 4.10 rear for work that has a cap and equipment weighing around 2500-3000lbs with no problems at all moving along although it does rev higher and shift more, normal for gasser. I get around 10-11 mpg mixed driving with the F350.

Good Luck