So, assuming you've got an axle up in the air with the driveshaft disconnected & neither wheel on the ground:
If you've never opened up an open differential and rotated the various parts to see how it all interacts, I highly recommend doing so. That's what really made all this make sense for me when I was first learning about Jeeps.
One good site for learning about this stuff is How Stuff Works. If you click on the "Spinning at different speeds" link and pay attention to the animations, you'll see what I was talking about with the outside wheel spinning faster than the ring gear while the inside wheel spins slower. When determining your gear ratio, the key is that you need to make your ring gear (not necessarily your tire) make one full rotation.
I'll expand the following into a page of its own eventually, but if you're curious how to find what your engine RPM will be with different tire sizes, gear ratios, and cruising speeds, use this formula:
Divide 336.1355 by the height of your tire in inches. Call this number P. Next, to determine your engine RPM at a certain speed (in MPH) with a certain gear ratio, you just multiply P times the gear ratio times the speed. If your tranny has overdrive, multiply that result times your overdrive ratio. If you've got an auto tranny without a lockup torque converter (which means anything prior to the early 1980's), then you can add about 5 or 10% to that number to allow for torque converter slippage.
For example, say you've got 31" tires, 3.73 gears, an auto tranny with 0.79 overdrive but no lockup converter, and you want to check your engine RPM at 70 mph:
So you'd be cruising down the interstate at roughly 2400 rpm.