When you checked compression what were the numbers? Anything under 170# with no more than 14# between any two cylinders is (by the manual) indicative of a rebuild. Low numbers
could simply indicate a need to adjust valve lash.
The 1.3L is not a power house anyway, and as has already been pointed out, running tall tires with no corresponding reduction in gearing (either at the transfer case or the differentials - or both) you will experience a reduction in power, especially in 5th gear, and especially at speed and on hills.
You can improve your performance by adding TC gears... 4.16:1, or better.
Good luck!
