FYI, the valve stem seals are known to harden and start leaking over time. It varies but at your mileage if they haven't been replaced then you can be sure that yours are leaking. Startup smoke would be a symptom as would be oil consumption without matching oil leaks.
Compression test and a general assessment of engine condition is the next step I'd take. If all is up to snuff then I'd lean towards doing the head gasket, stem seals and updating other rubber while in there. With a solid engine otherwise, addressing your oil leaks/consumption and doing the head gasket as PM likely buys you another 100k plus miles, easy. Unless you are still racking up the miles this could translate into many years of trouble free operation.
Along with your compression check, listening for knocks, perhaps a blackstone oil analysis, etc. to assess engine condition you should also try to drive another '94 fzj80. Yours may be 100% but still feel slow as many describe these as very slow. If your 80 is slow in comparison to modern suvs then there's likely no problem. If it's slow compared to another '94 then you may at least need a tuneup and some easy repairs. Tire size (depending on regearing) can also change the performance so if it's on larger than stock tires and not regeared and/or loaded with accessories/weight then those are other reasons it may be slow.
I don't recall if they had gone to AWD in '94 or not but someone will likely chime in on that point. In any case, as I understand it the only difference is that to make these AWD they added a viscous coupler that doesn't have much strength. Per some at least performance is equivalent in most, if not all, relevant ways with and without the VC. My 80 doesn't have the VC and I've never tested one with it so I just have to pass along 2nd hand info on that.