Ive set up and installed 3 8.8's recently. One was in a YJ, posi rear disc with 4.88s, second was in a 00 XJ, open disc with 4.56s, and the third is the most recent. Set it up for a TJ, posi rear disc with 4.56s.
The width is almost un-noticable. Non of the jeeps I built used spacers, and I dont think its even needed for the rear. I dont recall...but I thought it was less than the difference listed above. I thought it was more like .5" on each side.
Anyway... You WILL gain alittle bit of lift over a D44 or stock axle. The 8.8 tubes are pretty big in DIA. We had to add 3/4 to the front of my buddles 00 to level it out. We measured his stock axle vs. the 8.8 and there was a pretty decent difference in the dimension from the centerline to the spring perch.
Yes most guys weld the tubes to the housing. I did it on all 3. 4 - 1" stitch welds around the tubes. Remember to pre-heat/post heat if you are mig welding to the center section. Even though I welded all the ones I did, I dont think the guys that I built them for will ever beat on them hard enough to spin the tubes.
The rear disc set up works great. As far as I can tell its almost 100% identical to the ZJ D35 rear disc set up. Different part numbers, but the parts will interchange. E-brake stuff is 100% the same. Im pretty sure the calipers are the same...and that makes the rotors the same. And...you can usually get the ZJ stuff cheaper
I have a D44 with discs in my Xj now...because I happened to get one almost free. However, after I get rid of my jeep, Ill be doing an 8.8 in the next one. They are $50 at my local yard, already have disc, are SUPER easy to gear compared to the D44 IMO...not to mention stronger then a 44.
Summary...go 8.8, you wont be disappointed!
Oh...and dont forget, the mercury mountaineer is the merc version of the exploder... most salvage yards, unless they have a set price for axles like mine, will charge less for the merc part, because they dont know any better and mercs are usually less "in demand".
J.