@RovingCalypso: I revisited the earlier KZ vs L discussion and the reference point for 2L-TE that we had there from Surf Forums where people were getting ranges of 7-10kms for their Hilux Surf. By that token, your numbers are perhaps low (which was expected given modified and altered setup), but they definately are not alarming.
Also I think you had mentioned that your gears are short and you have to shift to 4th too early. This sounds like you have high geared diffs which would probably end up with high rpm on motorway speeds and hence lower mileage...but this may not necessarily be so.
Having said that I recently met an uncle of mine who nearly convinced me that his 1992 Surf was getting him 12-14kms per litre.... At the same time there are people you get 18kms/litre from a 2.0D. Personally, my Toyotas have never been so kind to me and such figures would make BMW envious.... but then again Toyota, Toyota hai!