I don't have to ask....the Rancho is better at everything, (including draining your wallet).
On-road performance, handling, ride-quality, are far better than stock. Obviously off-road prowess is greatly improved as well. Biggest drawback is the price ($2300 or so) plus a new set of wheels. After you get it installed, you can pretty much forget trying to keep your H3 clean...the offset wheels fling goo everywhere, and since nobody makes decent fender flares, you'll be stuck with a constantly dirty truck. If you're cool with all this...its a great kit.