The wallowing you're describing is probably largely a function of the shocks. (Are they the originals from 1995? The OEM Ford shocks on E150's and E250's were both kind of mushy)
Switching to a set of Bilsteins (even their "comfort" series) will yield a more controlled ride than the original Ford shocks. (Which, if indeed are the originals, are probably pretty worn out and ready for replacement no matter what.)
Good thread on choosing shocks for a non-lifted 2WD Sportsmobile:
new shocks for 2WD E250
In most cases on the Ford van stock suspension/ride height, you can usually move up to size 245/75R16 tires and they'll fit just fine. (And they work fine on the original Ford rims too.)
Here's a thread on the largest tires you can fit on the Ford vans with the stock suspension (and also with various amounts of lift.)
biggest tire size to not rub without a lift 2wd
Ride Height / Lift:
If you're really interested to get a bit more lift/ride height, perhaps 1-2", (and then potentially move up to a size 265/75R16 tire), you can look into inexpensive options like coil spacers (or different springs from perhaps an E350) in the front, and lift blocks in the rear.
*** but be sure to note --- anytime you lift a Ford Van front end significantly, you're going to usually get into having to make some adjustments to the alignment (in particular caster/camber.) ***
Here's a couple good threads on the subject of 2WD mild/inexpensive lifts.
Video on installing a 2" leveling kit on E350 2wd
Cheap Lift For a 2wd