Where are you getting your tire pricing from? It doesn't make sense to me that a 295/60/20 would be more expensive than a 35x12.5r20.... Contact the guys at Bully's Performance and get a quote from them. They had the best pricing around when I ordered my tires about 7 months ago.
There's lots of pictures throughout the forum of guys running 295/60/20's on leveled trucks. Just check out some threads in the wheel/tire section of the forum, leveled section, or the lifted section. You'll find lots of pictures there, especially in the sticky'd threads.