I have a 1999 K2500 Suburban with the 7.4L and 4.10 gears.
Stock suspension and motor. I keep it in good tune and it's running pretty smooth. The only real offroad upgrade is a set of 255/85 r16 cooper ST MAXX tires. Otherwise, it's bone stock.
Driving for best economy, I get 12 mpg. Never seen 13. In winter it drops to 10.5 mpg.
Towing my little 22' Aljo travel trailer, I still get 11 mpg. It doesn't care.
Last November I used it for a two week back-country trip in the Maze district. Hanksville is 1000 miles from me. Driving just under the speed limit it got 11.5 mpg hwy. With my father driving considerably over the speed limit, it got 9. Luckily, he was covering fuel costs :ylsmoke:
In the Maze, loaded with three adults, and all the gear and food necessary for 10 days of backcountry luxury living, it ran through 43 gallons of gas in 300 miles. That was offroad, fairly slow, low-range 4x4. My notes say 6.5 mpg, and that's the number I'll use in the future for fuel calculations.
I hear that the 5.7L will get in the high teens on the highway, unloaded. Falling to the low teens if it's towing.
I also have a friend who has a 2005 K2500 suburban with the 6.0L and 3.73 gears. He averaged 17 mpg on his coast to coast vacation last year with his two teenage sons and his father. No towing, they stayed in hotels.