Generally speaking, tires for a 16" wheel are cheaper. Plus if you go off road and need to air down, the more rubber you have the better. So that is two reasons you should stick with the 16" wheels. I had the 17" alloys and down sized to a set of 16" steelies.
A general consensus is that with a 16" rim you get more rubber (sidewall) and less rim = better for off-roading and very little difference on streets. Plus it looks better and 16" tires are usually cheaper. That's it in a nutshell.
I have to agree 16 is better for rocks. I run 15 on the jeep with 35" and I kick myself every day for putting 20" on my FJ when 17" were available but its more of a daily driver for me and the lower profile handles better with the stiff side wall. Now I'm lying to myself
While people keep saying you are getting "more rubber" its not substantially more. You are getting .5" more rubber when aired down with a 16" rim if that (if your tire actually runs true to size). Imo its not a substantial difference to go with 16" rims just because of that.
Also when you look at the recent drive tire industry tends to follow most markets. 15" wheels and 17" are going to be the norm in the future for the offroad industry. Let me know how many 16.5" tires you see these days.
16" wheels aren't a bad choice, but I would find the tire you want first and let that determine your wheel size. Also keep weight in mind as well.
In terms of sidewall height, yes there is only a 0.5" distance. In terms of sidewall surface area, the 16" rim tires have 5% more surface area as well.
Which isn't very significant, but i'll take all i can get.
I agree that the sidewall height is marginally better for offroad scenarios. If you keep the tire OD of the 16" (265/75R16) the same as the 17" (265/70R17), which is 31.6 inches, then the speedometer will read correctly.
In my book the 16" tire presents the FJ better. Also, remember if the tire you choose has raised white letters, have the tire mounted so only the raised letters are face inward, so you cannot see the white. Again a much better presentation.
Admittedly biased, (I spent alot on my 17" wheels), I found that the choices in more aggresive tread patterns/sizes seem to be greater in the 17 inch venue.
You also get more clearance for the brake caliper, or enough to upgrade to bigger brakes.
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At least in Canada, the price difference between 16 and 17 inch tires is substantial. For the price of 4 17s you can often buy 4 16s and a set of steel rims. Granted, this is my experience with looking for snow tires for my wife's FJ, but I'm pretty sure the 16s are cheaper in off-road tires too.
Hope someone can answer a related question. The TRD wheel of 2008 and again now in 2011 is listed as being 16". What I cannot confirm is the width. as I surf around for it, I find some sites calling it 16 x 8", while others indicate it is 16 x 7.5".
Anyone know which width is correct?