Just did rings and big ends with engine in place on my TJ. Easy enough with plenty of space. But don't know about mains.
Replacement engine is fine if you can source one that you know is good, try and get one roughly the same year as yours to keep the switch easier, the problem with second hand is that even if they offer a warranty they are often not tested fully, a quick start up is all some engines get in a breakers, we've had three duff motors sent in 2012.
Personally I would take the head off and see if all the pistons are reaching their top position. My advice is leave the manifolds on and the job is easier, you'll need a deep 1/2" socket for head bolts otherwise standard tool kit.
Good luck and keep us posted.