If I were you I would go with 255/70R16 BFG AT's, like Spike suggested. I don't believe you'll be able to keep your mudflaps with 265/70R16 unless you crank your torsion bars.
I have those tires in 275/70R16, and have been quite happy with them.

The BFG AT's have a 3 ply sidewall, which some say makes them ride quite firm. I don't really notice, but I also like a firm ride. If you're concerned with it, some people on the board like Pirelli Scorpion AT's, which have a 2-ply sidewall. I believe "O'Polka" just recently got these tires in size 245/75/R16 and has pictures of what he trimmed (not much.)

p.s. Spike--you really don't rub at all, huh? What about with the wheels only turned slightly? (It's been my experience they rub more when NOT at full lock.)

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gothamist -- MAXC member
http://www.beatdriven.com/xterra.html