Greenhorn: Re the "generations", I would use your terminology, i.e. the 95.5-04 is the first generation and the 05-up is the 2nd generation. There were some minor differences in the first gen Tacos but except for the front end they're pretty much the same. Not sure about the engined and drivetrains, although I do see some of the older 1st gen Tacos had manual hubs (my '04 does not.)
In any case, if you look at them side by side, the first major difference you'll notice is how much bigger the '05 is than the 95.5-04. This could be a plus or a minus, depending on your needs. I don't have a DC, so I can't specifically comment on MPG and performance, but my X-cab with a 5 speed does great on the highway, even with three adults in the cab (one riding "sidesaddle" in the area behind the seats) and for my driving style returns me 19.5-20.5 mpg in the city and 22-24 on the highway (this is a 4x4 with the v-6 and a Leer topper.) Of course, I have the 5 speed which was not available in the 01-04 double cabs. Also, IIRC the auto-tranny equipped 01-04 models do have an electronic T-case. Actually, it's what I would call a semi-electronic T-case: Shifting from 2wd to 4wd and back is done electronically, while shifting from high to low is done "mechanically" with the shift knob.
Personally, I have an intense dislike for electrically shifted T-cases, and one of the reasons I got an 04 with a manual tranny was that I wanted the manual T-case shifter. I'll admit that it's a personal prejudice of mine, since there are plenty of folks with electrically shifted T-cases who say they work fine (although go over onto the TTORA board and you'll find at least one guy whose 01-04 DC would not go into 4wd when it was wet, due to an electrical malfunction.) In any case, if you go with an '05-up you'll get the option of a 6 speed manual with the Double Cab, though only with the shorter bed. The 05-ups also have some cool stuff like 110v and 12v power outlets in the bed, which could be great for an expedition rig, especially if you have a shell.
I found my '04 Taco to be an amazing off-roader. On the moderate trails I run I have no problem keeping up with the TJs, so that should tell you something. I've never really done any long trips so I can't comment on all-day comfort, other than around town. Hopefully I may be taking a road trip later this month and if I do, I'll report back the long-distance ride comfort. My previous vehicle, a Subaru Outback, had a badly worn driver's seat and so it was not comfortable on long trips, so if this one is better (and I assume it will be) it will be perfectly fine for me. Nice thing about Toyotas, of course, is the ample aftermarket and the compatibility with the more luxed-up 4-runner. If I don't like my seats it shouldn't be too difficult to swap them out for 02-down 4runner seats since they're basically the same platform.