Okay, I'll put in my 2 cents worth.
First, run away from Poly suspension bushings. These are much firmer and will not flex as much as stock. In return this adds a lot of extra load on the mounting points and you can actually rip the mounting flanges off the frame and/or axle. On a sports car they might be great but for an offroad vehicle, in this application, this is not what you want.
Second, 90% of people's death wobble comes down to 3 main things. The most common thing of the three is a worn out track bar. The stock one was designed for a stock hight vehicle. When you start lifting them, they will start wearing out very quickly due to the design of them. An aftermarket one like from T&T, JKS or RE will eliminate the slop and won't wear out like the stock one will. Second item is the alignment. XJ's are very sensitive to caster and at ~3" of lift, you actually need longer lower arms. IIRC it was 16" center to center which is 1/4" or so longer then stock. Higher lifts need even more. Adjustable aftermarket arms can take care of this (I like the JKS ones). Third item of this list is worn out ball joints and tie rods. Tie rods are fairly easy to see if they have play by having someone turn the steering wheel while you watch the joints and see if any movement of the tie rod before the wheel starts to turn. The ball joints are much harder to figure out and typically cannot visually be seen. If you have corrected the above items and still have DW, then ball joints are typically the issue, especially if over 100,000 miles. Also note that the track bar frame mount can come loose and cause DW so check that too.
As for the steering dampner, a leaking/worn out one will not cause DW. A new one will mask the real problem, which will return. The steering dampner is for the drivers comfort, NOT to fix a problem. It helps dampen the steering jolt when you hit a bump/pothole/rock/etc. It helps to keep from having the steering wheel ripped from your hands when you hit these. Many vehicles over the years never came with them and did not have DW problems. If yours is leaking, replacing it is fine but it is not the solution to the DW.
Hope this helps and guides you to finding the problem.