Morning Khudooma,
the 3.5 V8 will use around the same amount of fuel as the older patrol, (change the engine) i would change a 3.5 V8 with either a 3.9 from Disco 1 or 4.6 from Classic Range rover, more power and torque. the Puma engine from the Ford transit is the best but hard to find, to make it great it has to be chipped but not expensive to do and parts available on the net. if you are only going to use in the Middle east then the Petrol is nice but for reliability the diesel wins + you can take it anywhere in the world, the petrol for example would cost too much to run in most other countries.
have fun and keep looking, from time to time a good one comes up in the market, if in a rush look at importing one from Europe.
if your looking for a great desert and moutain ready car for just under 40K give me a shout as i may have to sell my modified 2003 discovery 2 due to a move coming up, its not a defender but it will go everywhere and alot more comfortable than a defender would ever be. + much cheaper if your saw it you would buy it.