So I learned a ton and am not done after a f-up working on the transfer case the first time.
Got it out and open. Use a goddamn floor jack. I thought I would be a badass and just bench press it down. Ouch, its more awkward than heavy. Oh, and be extra sure that all wires are disconnected! Also when opening the case the output shaft ring clip is a *****. Open up ring, tug up on case until the ring slides off the back of its groove. THEN through the speed sensor holes one at a time use a screw driver to pry down on the gear to get the case moving. Always be pulling up. It will release eventually.
Remove a clip and the speed sensor gear, gear, bearing and pump come off the shaft. Not hard. Here is where I added the Merchant Auto pump rub kit. Get a good T15 torx. My crappy chinese bit bent with little torque when tightening to 80 in-lbs and stripped a screw head. Luckily it was torqued enough before stripping.
I put it all back together, mounted back in truck and went for a test drive. NO BUENO!!! I got a really nasty whine once I hit about 15mph. I whipped back around and parked it in the garage. With the rear wheels off the ground I got the wife to put it in gear while I searched for the sound. It was the goddamn transfer case. This was an easy job, what could go wrong?!
Learn from me....
DO NOT OVER TIGHTEN SPEED SENSORS! THREAD SPEED SENSORS WHILE CASE IS OPEN, APPLY LATERAL FORCE TO SHAFT WHILE ROTATING TO ENSURE SPEED SENSORS DON'T TOUCH SENSOR GEARS!!!! Mother-effer... what an idiot.
What I was hearing was speed sensors rubbing and grinding away. I had to pull it all out again, open it up and prepare for more parts. On top of new speed sensors I decided for a full rebuild because I figured at about 150K miles it was due. I ordered a ton of new parts before really taking a good look. Lucky for me the bearings and seals look good. I also found the clutch pack to be in awesome condition. I think I'll just box up the rebuild parts for the future.
I'll still do a new chain.
Clutch pack rings all had lots of friction material and no signs of over heating.
Also a new filter at the end of the oil pick up.
I hope to be on the road again soon.
Three more things.
1) Use blue locktite on the transfer case bolts.
2) Apply a THIN bead of sealant when sealing the case. You can easily clog the filter at the end of the pick up tube and starve everything of lubricant.
3) I was stupid again and totally forgot blue loctite when bolting the transfer case to the trans the first time. The paper gasket between transfer case and trans can compress a bit over time and give non-loctite nuts a chance to fall off.