Most people recommend againt towing with a dolly, even the owner's manual. It can be done and I've done it, but I unbolted the rear driveshaft and tied it up.
I currently use a towbar to pull my YJ with our TrailBlazer,
transfer case in neutral and tranny in 1st as per the owner's manual. Auto's are in park,
transfer case in neutral.
The dolly pulls better than the towbar, so it's up to you. The towbar will do fine with smaller tires, but tires larger than the tow vehicle tend to pull the tow vehicle around the highway.