Hey 89suzi..
Yep, 1ltr transfer case will offer lower gearing to cope with larger tyres..
Will they be enough for 31's? Can be a bit personal.. Some will love it that way, others will yearn for lighter gearing still!!
I don't know off the top of my head what the ratios are for 1ltr and the percentage reduction but others will know.. I will try a quick search (but I'm on night shift so my motivation to scour the threads is slim at best

).
There are two different types of 1ltr t/f case. Switched and non-switched.
The switched one should be a bit more straight forward to put into a WT. you can put non-switched in, but you might need to fluff around with the drive shaft flanges or something!? I think
http://www.1010tires.com/Tools/Tire-Size-CalculatorTo start you off, the above website is a good calculator to gauge the differences in different tyres.. If you get the tyre circumference and compare your 31's to standard, you should get a picture or starting point on how much you MIGHT want to adjust the gearing.
But again, it can be personal. If your happy with it, run it. If it causes a problem, resolve it

Check back if I find more info