YES on capicity...and your refill volume will be lower than that number on first attempt...even after "burping" by squeezing upper hose a bunch of times.
I should mention that I personally drain the system warm (after pressue carefully released)...with water valve open for entire process(colored dial on full heat).
On refill with distilled water, including the overflow bottle (that I have siphoned dry...noting that they get nasty in the bottom) I can barely get past 2 gallons. Then I start car, heater on and set to defrost so that I can feel the hot air sooner (confirming water pump working...remember that pumps can be trouble on 01's), and stare at temp gauge...noting that when fans come on and temp starts to fall, I shut it down and drain soon there after...often going through 20 plus gallons of distilled water.
Personally, I usually premix the coolant 50-50 with the distilled water for the first 10 quarts...this allows me to fill the overflow bottle first with the correct blend. Then I fill the system, restart, run as before, BUT allow the engine to completely cool to allow overflow bottle to refill the system after the residual air is displaced. Then I repeat my fill cycle using undiluted antifreeze in small amounts until testing shows that I have proper freeze protection (remember that the new 50-50 mix is diluted by the residual water in system...something that you will habndle equally well with your plan to add the antifreeze first, as many others do).
Check and recheck levels in pressure tank and overflow bottle for several run cycles....being SURE that pressure cap either tests OK or is new (preferably tested before usage as well).
I ALWAYS change hoses to Roe Racing silicone hoses with first coolant change as it "comforts me" !!!
FYI...I notice that the 3 year Mopar coolant formula when mixed 50-50 precisely with distilled water nets a ph of around 9.5 on the test strip color scale.
Craig, however you choose to do it, the Gen II is MUCH easier to complete than the Gen I.
I personally do not open the air tap on the thermostat, though I have had a machine shop make a tool for me to do so...but if you do...be careful of the IM, and take care NOT to crack thermostat housing as this vent has Loctite or something similar on it(see my post about torque required to open this aboout 3 years ago...more of a PITA on 2001 than on a 97 or 99).
Make your own decision on the block plugs...and, feel free to call me if you need something when you do it( I do have a spare T-stat plus housing, 01 water pump, and gaskets as NO ONE ELSE STOCKS THEM or can get them on a weekend)...especially call if my BS above is misleading or contradicts to your experience and good sense !!!
Steve