Don't know about the 86 and this is the first I've heard of the O2 at the Cat.
O2 is at the exhaust manifold or in the down pipe about 6" below the manifold.
Yes, order per the year.
That said, nothing will really change.
And if you are changing trans any way, you'll want a '94+ to get the external slave/bell.
I've got Hancook on the XJ and the Nissan both are excellent Highway Tires both are good in the snow and rain.
I have Nitto on the MJ it's a fairly large Tire but it's excellent on the highway very smooth I'm getting ready to go up in size and I will get another set of Nitto.
For a double cardan the pinion is supposed to be looking directly at the TC, from what I see here the pinion angle is correct.
http://www.billavista.com/tech/Articles/Driveshaft_Bible/index.html
When I look up 2004 Escalade VSS it shows that it reads a tone ring, is the VSS in the Atlas gear driven? Are you assuming that the values or signals are compatible?
I'm not smart enough to mix and match decades old tech with more modern tech. Nor do I think you're going to run a single wire from a GM PCM to run a tach that was driven by a Chrysler PCM that you are no longer using. What is driving the tach?
Lost on me...............