I would say that it can hold up to pretty much stock power levels. Its just an Borg Warner 1354e. If you increase your power too much, then I would say you need to look into both a built trans and tougher transfer case. But I don't know of any cases that will bolt up to the ranger's tranny or any upgraded trans that will bolt up to the engine and work without a lot of modifications.
Also, a lot of guys swap in a manual 1354 just because the manual version is more reliable cuz there will be no electrical diagrams. I am also fairly confident that both the electric and manual internals are the same durability wise, but I could be wrong.
The early 1354 cases had 4 gear planetaries, and the later ones have 6 gears. The upgrade wasnt to eliminate a weak link, but to reduce NVH (noise vibration and harshness) the case or chain will blow apart long before the gears strip or fail. The 1354 came both manual and electric form and the late model (98+) cases use a "cup" style front yoke verses the double cardian joint found on the earlier Rangers. That transition was also the reduce NVH not to upgrade in strength. the only real upgrade you can do is get a manual case. But the manual cases with the "cup" style output are only found in the FX4 package Rangers. Another issue you may run into if you swap for a more reliable manual case is the fact the shifter needs to come the the floor where you center console is (you have a canter console IIRC). I have a thread in the tech section that addresses this issue when dealing with a full length Exploder or Ranger console.
The manual case I swapped into my truck was only a 4 gear planetary. The 6 gear planetary electric case I dropped out had nothing wrong internally I was just tired of the motor failing and wondering if it was in or not, so next time my manual case is off the truck I am going see if the manual 4 gear can be swapped for the 6 gear from the electric.
i got my 302 and if i can get a atlas 2 i can start looking for a nice transmission and than a ford 9 rear end and a front dana 44 and a junk yard gen 1 or another 2003 FX4 ranger and put it all together to make it a beast