Hmmmm...I'm interpreting that as suspension travel, not shock travel, but maybe I'm wrong. Here is another link that claims 4" of "suspension" travel:
https://www.race-dezert.com/forum/threads/h3-long-travel-build.85789/ I think it's the same person (Beebe vs Bebe?). And here's one that says 5.75", and claims that it was actually measured:
https://www.hummer4x4offroad.com/forum/showthread.php/6138-H3-Front-wheel-travel
In any case, I've been off-roading and racing motorcycles for over 5 years, and have never heard the term "suspension travel" to refer to anything other than wheel travel, never "shock" travel. I've seen pics of the H3 with the suspension completely compressed and with it completed extended (tire in the air), and it looks like 4-6" of wheel travel is about right. That would seem to translate into somewhere around 2-3" at the shock.
BEBE says that overall she was happy with the Rancho kit and would do it again. If the shocks cut the suspension travel to 2", I doubt that would be the case. There are also plenty of people running the Rancho 4" lift; those shocks also have the shorter 2" travel, yet I've never heard any of them complain about their suspension travel being reduced because of it (granted, perhaps not all purchasers also got the Rancho shocks, but I assume many did).
The "limiting strap" function would be at the extended length, which is pretty much the same length between the OEM and the Rancho, while the compressed limits are from the bump stop, like you say. Perhaps Chevy may have spec'd the shock with additional compression travel to accommodate for possible loss/deterioration of that bump stop, and Rancho did not?
Later today, I'm going try to go out and see if I can get some measurements; with some basic numbers, I can draw the setup in autocad and see what kind of travel the pivot points and upper/lower stops produce at the shock location vs the wheel location.