The iO is the only small yet modern 4wd on the market capable of high speed touring and serious off roading. The transfer box allows 2wd through the rear wheels; all wheel drive with center diff; High-range locked center diff and low-range locked center diff.
On the bitumen the iO handles well, comparable to most small cars with a short wheelbase. It handles potholes, but can crash a bit over large speed humps if driven over 60km/h. This is mainly due to the short rear suspension links.
Constant-4 in the wet is a dream, smooth cornering and controlled application of power.
The 2.0L engine lets you cruise easily at 120km/h, and will punch out to over 160 if wound up in 4th.
High-speed dirt road driving is smooth and surprisingly quiet. 2wd tends to over steer with the rear stepping out under power, while 4wd (you can shift into at up to 100km/h) feels very balanced and neutral. Low ratio L4 gives the iO tonnes of power, and it readily climbs, but can lift wheels if you approach obstacles too fast.
Front suspension is limiting in tyre choices without modification. A 225/70-16 will fit but very close to under side of McPherson strut spring-base. BFG tyres manufacture a 215/65-16 that is the standard size specified by the manufacturer. Apparently KYB replacement front struts add 20mm clearance. Rear diff-lock is available through ARB Australia, however snorkel's, winches and integrated bull-bars are only readily available in Brazil.
I bought the iO to replace my aging Lada Niva, and the iO, while not quite as high or flexible, will still give most large 4wd's a run for their money.
The 2.0L MPI 4G94 motor is easily enhanced with many of the "Mitsubishi Lancer" hot parts i.e. camshafts and ECU piggy-backs, but in its stock form produces excellent power while maintaining 10.5L/100kms, even with heavy driving (98 octane fuel, economy significantly worse on lower grades).