While the first bit of advice from MyBigToy is golden, I did a good bit of research as we looked to upgrade from our 2004 to - something newer.
Here are the high points:
In 2007 GM went to the GMT900 platform.
- What this means is they discontinued the 2500 (3/4 ton model) so no more 8.1L, heavier suspension and 8 lug (heavier duty) axles. -1 point for the 2007 and newer (GMT900).
- With the change in suspension, they lost the torsion bars for a front spring, going coilovers and greatly improving the ride and handling. +1 point for GMT900.
- From 2007 to 2009 GM offered the 6.0L as an option. It had a baseline of 366 HP to ~320 HP for the 5.3L's. Torque came to 376 lb-ft vs 335 lb-ft (348 lb-ft on E85) +1 point for the 6.0L.
- Beginning in 2009 GM offered the 6 speed 6L80 transmission, instead of the 4 speed 4L60-E and 80-E automatics. +1 point for GMT900.
- For the GMT900s, the engines were equipped with AFM (active fuel management), shutting down 4 cylinders under light load or coasting. There was a problem with the AFM that was fixed for 2009. +1 point for GMT900, 2009 and newer.
- The 6.0L also offered VVT (variable valve timing). No points, already awarded to the 6.0L.
- The Z71s are nice all around with off-road-ish suspension. The Z66 was a 2WD version with sport tuned suspension instead. No points.
- The LTZs also have an air-ride suspension, meaning the shocks will adjust automatically, mostly for trailering, keeping the vehicle level instead of hunkering down under load. +1 point for GMT900.
- LTZ - the premium package. Backup camera. DVD player. Heated and cooled front seats. Heated steering wheel. NAV. Bluetooth phone. Trailer brake control. The best package for the Avvy's. +2 points for GMT900s.
Now, what does this mean for you??
I lucked into my 2009 with the 6.0L and 6L80. 2009 was the only year for this option. Some complain that the 6 speed is finicky in it's selection and timing of shifts, I find it's fine. Plus we have an LTZ where the only option we're missing is the heated steering wheel.
All that said, the GMT900 is a huge improvement for the Avalanche. If you can, get a GMT900.
However, there's always a caveat, the GMT900s have a sharp increase in price, usually. If you take two Avalanches, a 2006 LT with standard equipment (last year for GMT800) and a 2007 LT (first year for GTM900) , the 800 comes to $9,934 while the 900 is at $12,661, with both of them in excellent condition and 140,000 miles.
The LTZ is about another $1000. Numbers from KBB.
Essentially, if you're looking at either 2006 Z71 fully loaded with 85K miles vs. a 2007 LTZ fully loaded with 110K miles, well, I don't envy that decision...
Good luck!