The exhaust is not badly set up for a std 3.5, but can be improved in a number of ways depending on what you want. If you just want to make it louder then remove mufflers or make them smaller or switch to straight-through types if you are on a budget, and/or make the pipes bigger if you want to spend extra. This will make it louder and will likely rob you of some torque but make it sound like you have more grunt despite you going slower and annoying the locals. If you just remove the centre muffler it will drone like a b4stard... you need something there.
If you want to improve performance as well it gets a bit more involved. The standard exhaust manifolds (4-into-2) are pretty good and will do a good job even on modified engines (I've got over 300BHp under my right foot on standard cast manifolds). The general consensus seems to be that under 260-280BHp the cast 4-2 manifolds do the job well (refer Des Hammill). I left the small-ish twin take-down pipes as-is (to keep the torque) but opened them up from the first join (where they go into the 1-5/8" Y-pipe) to run two 2-1/4" pipes to the centre muffler, but I'd use 1-3/4 or 2" for a stockie. The centre muffler out of a Ford BA series XR6T (or F6 ute) will drop into the spot the standard one lives in and is a free-flowing, straight-through 2-1/4" twin in and out design with good volume for reducing the noise whilst keeping the flow. Can be tucked right up and I've barely scratched mine in years of off-roading. It's stainless steel, too. But you won't get enough mixing through it alone so I'd recommend a balance pipe in front of it (or run an X-merge or whatever design you fancy). Then you have the choice of bringing the twin-outlets together into a 2.5" single or running twins over the axle (my choice). Then a small can/resonator under the rear wing will take out some harshness and keep things legal whilst still giving you that lovely V8 noise. But this really won't get you anything on a standard 3.5. You might get a little bit out of a std 3.9 (I barely picked it).
So short answer would be to find a decent, large, straight-through muffler to drop into the centre and leave the rest alone. Or spend up big and do it properly (and gain little if anything). The (tri-flow, baffled) centre muffler is really the only significant restriction in the system for a stock or mild engine, so upgrading it gives you the maximum bang for your bucks. You can always put a drain-pipe blingy tip on the back if you want to impress the ricers...
DiscoClax
'94 D1 3dr Aegean Blue - 300ci stroker RV8, 4HP24 & Compushift, usual bar-work, various APT gear, 235/85 M/Ts, 3deg arms, Detroit lockers, $$$$, etc.
'08 RRS TDV8 Rimini Red - 285/60R18 Falken AT3Ws, Rock slider-steps, APT full under-protection, Mitch Hitch, Tradesman rack, Traxide DBS, Gap IID
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