I would suggest keep the frame mounts on original location. Pieces to convert from donut to trapezoid are available from MB. One thread here: viewtopic.php?f=18&t=6458
If you really think you need to change engine location, do it with brackets between engine and rubber mount. I have OM617A on original 300GD location and with 2” inch lift springs have had no issues over 10 years.
Stock exhaust for OM617A is 2.5”, 3”pipe area is 40% larger, if you are not going for larger turbo and IP in future, might bit too much.
Why you need to cut front drive shaft? Transfer case is separate unit on G. You need new middle shaft if changing engine location. When modifying G original shaft you have to look out for splines what are covered with some sort of plastic, if melted the shaft is ruined.