OR, and bear with me here, you could get familiar with the literally endless number of Tacoma forums out there, and then get familiar with your truck. Every single vehicle on the road has idiosyncrasies that throwing money at wont solve when youre in the middle of nowhere, but your intimate knowledge of the parts and function might.
Assuming you have the 4.0? The issue as i understand it, only really affects certain series of vehicles, and the newer gaskets with superseded numbers are no longer an issue. Do you know yours falls within the range?
I have a 94 Landcruiser and head gaskets have always been a bit of an Achilles heel for them in the US (anecdotally because of the EGR system dumping into the #6 cylinder). I’ve done mine once for failure, and Im doing it again right now because the head had to come off for a non head gasket related issue. The original head gasket was very clearly inferior to the one I just pulled off, which showed zero signs of wear or damage after 65,000 miles of heavy use. I’m replacing it with another of the superseded parts, and I expect no issues with it either.
I use my example even though its apples to oranges to say that the modified parts can make all the difference. There are hundreds of thousands of Tacomas on the road from your generation with hundreds of thousands of trouble free miles on them all over the country. One of my wheeling buddies has a supercharged 05 (late, December build date) with 240,000 miles on it, going strong.
It’s a roughly 3500.00 job if you pay a professional to do it, which is a good bit less than what youre looking at to upgrade, but if youre itching to upgrade, there may be other factors at play. Of course, you never know what youre getting when you buy a 15 year old used vehicle, and if you have the work done to yours, it would then be a known quantity.
The axle wrap you mention is still an issue on Gen 3 trucks (and any leaf spring vehicle unless Specifically addressed) and can be managed with a good suspension upgrade, which would still put you in under your projected Gen 3 price if you were careful.
**editing this because that sounded more dismissive than I meant it to.
Totally up to you, just my .02.