Someone went the other way (put the 3.5L eco into a Gen 1), but I have not heard of someone putting a V8 in the Gen 2. The 3.5L swap was a lot of work, but they got it going and proved it could be a pretty capable truck before the Gen 2s were available.
Brad is probably the only one who has the $$$ to do it and he already has more than $50K into his Gen 2 without swapping the motor.
brad? Honestly, once you decide to go for it, 50K in upgrades is not even getting into "stupid" money. I've already blown past 50K. shit 30K might get all the suspension and accompanying req'd supporting mods done.
My 3.5 goes **** up and I'm going for a 5.2 cpc blown motor.
I'd bet that while the "modes" might prove a little problematic, you could get around it.
while not "easy", I wouldn't quantify it as hard, being that everything should bolt up aside from motor mounts ( possibly).
the hardest part will be the traction control and any laser guided cruise issues.
torque management will take a little while to get through, ( plus putting some nannies in as to not destroy the tcase with a full boat throttle bump on dry pavement.
that and the more you mod, the less all of the electro-whiz-bang stuff matters.