Actually, I looked into two cats a few minutes ago, literally. I found two Magnaflow cats salvaged from a past project that I had forgotten about. With them was the Tahoe's factory resonator from the tailpipe. The cats are a bit undersized at 2.5", but I considered something. Follow me here:
Going from the front and working rearward, the header's Y-pipe merges into one 3" pipe. A merge Y splits that 3" into two 2.5" pipes. Those two 2.5"s go into the two cats positioned side-by-side. Another merge right after the cats brings the two 2.5"s back to a single 3". The muffler will be immediately at that merge and the exhaust from there is just as I currently have it now.
Of course, the cutout will be inline, ahead of this route, immediately out of the header's Y-pipe. I omitted it from the above explanation to reduce confusion. It will just be a 3" pipe that runs out of the cutout, parallel to the cat/muffler setup then curves back in after the muffler to exit out of the same tailpipe.
My only concern with the cats is, while they should return the sound (and smell) I had before, they'll be much further down the exhaust stream than where the factory cats were located. They may not get hot enough to burn off the hydrocarbons and eventually clog. My counterargument to that is with how little I drive it, they may still give me years of use before they clog, if they ever do. As always, rolling dice...