What a great thread with balanced responses.
If I was doing it again I would consider a TD5 purely and only from the point of view of range. Having said that I would not give up my 4.6 D2 manual for anything - now that is torque with the Thor manifold, Bosch injection, high compression and exhaust work. Mine runs at 85 degrees C most of the time, so I avoid the risks with overhot running, and the 4.6 was typically the thickest casting. My 4.0 was excellent though and I would run it again. I think overall there is less to go wrong on a well maintained V8 (including WELL maintained cooling system) versus the TD5 but that would not stop me owning a TD5.
Personally I love how quiet and throaty the V8 is. For long range touring you cannot beat the TD5 in terms of range and ability to pick up diesel anywhere etc (although these days petrol is available even on outback properties). Personally I think overall the extra servicing costs of the TD5 compared to a V8 that has not been overheated (and has a well maintained cooling system) versus savings on fuel is just not worth it.
The off idle torque from the V8 is also a boon offroad.
If I didn't have a D2 and was going to set one up for a LOT of long distance remote touring I would go TD5. However given that my D2 is my daily driver and tows a 2 tonn boat and also does the odd long distance remote trip the V8 suits me better.
So it all comes down to what you value, what you like driving, and cost.
Cheers

