I had a switch go bad but it was before we put on the lift I think (warranty). No problems with it since then.
If people do not add the correct disconnect extensions when they lift they could have problems.
You are still going to want to upgrade it, I still want about 20k worth of stuff to add to mine.
Look for a good used JK or a TJ Unlimited and save 10 grand, then spend the 10k on lift, armor, wheels, tires, etc.
I don't remember what you did to your XJ, mine was just a little fiberglass readjustment