Here's what I have owned and my perspective on small blocks vs big blocks in these trucks.

1. 1993 2wd F250HD 5.8 3.55 axle
2. 1993 4wd F350 SRW 5.8 3.55 axle
3. 1995 4wd F350 SRW 7.5 3.55 axle
4. 1996 4wd F350 SRW 7.5 3.55 axle (I still own this one)

With the 3.55 axle here's what I"ve experienced.
The 7.5 doesn't do much worse on fuel in these trucks when unloaded and actually gets better fuel mileage towing than the 5.8.
The 7.5 cruises and tows much better than the 5.8.
The 5.8 is a great and reliable engine,but it is on the small side for the size of these trucks.
Of course the 5.8 will do better with the 4.10 axle but it doesn't have muscle of the big block.

My .02