1/8" now!! - Your prolly right! They are small. But yea, Auto Zone and Murrays here sell rubber replacement line by length. The 4WD lines use to be blue and pink (at-least they use to be). The rubber line included in that harness is the breather for the axle. It just stubes off and is pegged on the plastic fender-well . Make sure that gets put back in place if you mess with it.

Just get enough hose to repair, unless the lines are brittle and dried up.

All that the Ford repair kit consists of is a rubber union. No big deal. When you repair, just dip the rubber in mineral spirits , then attach. The rubber will then shrink fit around the plastic end sections.