I have the best of both worlds with my 06 Grand Cherokee Overland. I've modified the 5.7 Hemi engine fairly extensively and still retained the cylinder deactivation feature (MDS). I've also added the complete SRT8 suspension so I have the handling capabilities of the SRT8, maybe even a little better, as mine is slightly lowered.
With the current setup, I am at about 420-430 hp. and the fuel economy in town varies from about 12-14 mpg, depending on the amount of stop and go. On the other hand the highway fuel economy has risen by about 25%, going from 17-18 mpg to 21-23 mpg. These fuel economy figures are also ALL at higher elevations ranging from about 2400-5000 ft in hilly/mountainous terrain. Most of the increased fuel economy can be attributed to the MDS (worth about 2 mpg on the highway) which is active nearly 95% of the time at cruise (63-67 mph is the "sweet" spot), the mild aftermarket high torque camshaft (I advanced it 6 degrees), and the custom header back exhaust system.
Other modifications which have helped to a lesser degree are transmission shift kit with custom shift schedules, custom tune, high voltage output ignition coils, larger throttle body, ported, polished and milled cylinder heads, vortex generators, custom cold air intake with a high flow filter, underdrive crank pulley, and a PCV oil catch can. This setup has worked so well that I duplicated these modifications on my 2005 5.7 Dodge Magnum, and its highway fuel economy has also gone up by about 25%.....about 23-24 mpg to 27-29 mpg.