Wow, what a topic starter!! First I'd like to say I have a 97 3.5 and get from 23-29 MPG with a lead foot. I use mid-grade fuel and clean the injectors with a can-o-stuff ever now and then. I change my fuel filter periodically and also the air filter. The air filter can cause poor mileage and can dirty up fast in some conditions so the K & N spray and lube type is nice but expensive. I have always just used the cheep throw away kind, if this is what you use make sure to change often.
From my experience (other than driving habits) the major contributors to poor fuel consumption are:
1. Dirty injectors and fuel filter
2. Dirty air filter
3. Weak spark
4. Poor compression
If the car isn't malfunctioning, then the answer must lie in the filters & injectors. While gas is also important, it isn't as important as some believe. I live near a CITGO gas terminal (where the barges bring the fuel in) and nearly ALL the gas stations use the same gas!!! I spoke with one of the drivers and asked how they fit all the different grades/quality fuels on the tanker and in the terminal tanks. He chuckled and said “it is the same gas for nearly all the stations; they just add their secret ingredient prior to filling the truck" (I think there was 1 he had told me that actually trucked in their own blend). This is the trade mark of all fuels, their additive. To me, it's just as well to add my own favorite cleaner additive and buy the cheapest gas on the market! Some don't like to go to that trouble and just pay the higher premium at the pump.
As for octane, yes higher compression engines require a higher octane or they will PRE-detonate (octane is a retardant and makes fuel LESS combustible but is required with higher compression engines or you get the pre-det knock). The 3.5 engine has a nice feature many don't know about called a "knock sensor". What it does is if you are running a cheep low octane gas, it retards the timing so the engine is less likely to pre-detonate. Of course that also translates to less performance and the adjustment can only do so much.
Any way if you really want to run better performance I heard from a friend about a kit to mix hydrogen to the fuel/air mix which will give a 40-50% increase in MPG, and increase torque/power while decreasing emmisions! I have not done any research to confirm or deny it, so if any happen to try this new tec., please post it!
New eddit..........
Here is one link the the hyd kit I mentioned above.
http://www.greencarcongress.com/2006...e_begins_.html
Kurt