Thanks all for the responses. I do plan on spending a ton of time in the mountains. I am an avid flyfisherman, backcountry skier, mountain biker, rock climber, hunter, camper, backpacker...you get the idea. I have owned 3 jeeps so far with a Wrangler Rubicon+ Warn winch being my last. That Wrangler was a real tank, the only time I got it stuck was when I was trying and even then some good recovery gear, a winch, and you were free to roam about the country. That being said, like others have mentioned, I hated the gas. I have friends all over the west and would like to be able to visit them more often without the trip breaking the bank. Also when looking back I only used the full capabilities about 10% of the time, maybe more, and the area I am moving to will be more civilized then where I lived previously so I am hoping to be able to cope with the Prius/Subi.
I do have concerns over ground clearance etc. and I will definitely be spending time on forest service roads. I have also read about the traction issues that I am a little concerned about, I hate traction control on any vehicle. It does seem that the Gen III might have at least semi fixed the traction problems, among others which is why I am reluctantly swaying towards spending the extra.
It is good to hear others having used the Prius in the great outdoors successfully. I am still torn between the two, given the Subaru is a natural choice for the outdoors. But the Prius gas mileage is so enticing and I am pretty dang good at getting vehicles unstuck. I would also love to hear from others who have had some rugged Prius experiences, good or bad to help me make sense of it all.
Thanks again