Transfer Case Issue

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Does it unlock if you just shut the engine off and leave the trans in neutral? Can you push it / roll it in that state?
No. To move it I either have to pull the driveshafts, or the encoder and manually shift the case.
 
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What does it do if you leave the encoder motor uninstalled (strapping it out of the way) and manually shifting the T/C into 2wd? If that seems to work, then there is something wrong with either the encoder motor or circuit, or the TCCM.

It would really help to have a Tech 2 on it; that way you could monitor what mode is commanded vs. what mode it's in, or thinks it's in. On my NBS, same T/C, the commanded mode was 4HI but the actual mode was AUTO. That ended up being a bad encoder motor.
I tried another encoder, and but it's used also and not guaranteed to be good. Same results. I lined up another tccm for $50, I'm going to give that a shot tomorrow.
 

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I have a '99 Tahoe that won't move, it's almost like the transfer case is locked up. I pulled the driveshafts, everything turns. I pulled the encoder motor off, I was able to shift the case manually with no problems, and front axle is free in 2HI. I put another encoder motor on that i had laying around, and with the ignition on and engine off, everything seemed to be ok. However, once I started the engine I was right back to things acting like they're locked up. TCCM bad? First time with one of these.
I have a 246 on my 2004 tahoe that had the dreaded oil pump rub through the case issue. I pulled all the gears out of there to put in the new case. Its pretty simple gear on gear not much to go wrong. I really doubt its the transfer case. If you really think its the transfer case and you can transfer manually might consider disonnecting the electric connector off of it so it doesnt move when you start it.

Have you tried starting in reverse to reset the controllers? Not sure if the 99 will reset but on an 04 put in reverse then try to start in reverse will reset a lot of computer controllers…i would bet its the transmission. There are some ball bearings that go in the valve body i have heard will do this.

If the motor is off can you put in neutral and move it? And then you turn it on its locked up? If that is true I dont see a transfer cause malfunctions this way. Most likely transmission pumping fluid and something is hydraulically not letting it move. Transmissions are very complicate when you realize there are no gears in a transmission. The “gears” are just oil going theough different passages and locking up a drum but not a single gear in there. A transfer case is gear to gear not much could happen unless a gear or chain is broke.
 
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I maybe haven't been very clear on this:
The truck will not move currently at all. That includes when the transmission in neutral, engine on or off. I had to pry the encoder off the t-case, and when I did the selector shaft returned to a static position. Whatever position this is, it not only corresponds to the power off position of the encoder, but until the engine starts the t-case appears to operate normally. I can spin all the wheels in neutral, the rear shaft is connected in 2h, both shafts connected in 4h. When I start the truck, the encoder returns to that stuck position. Could it be a transmission problem? Possibly. I haven't tried to drive it with the encoder removed yet. I was going to try another tccm today, but I got sidetracked on some more pressing issues.
 

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I would take the encoder off and put it in 2wd manually and drive it around. If it drives fine the transmission is fine.
 
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Had some surgery, had to hold off for a few weeks. I tried a different TCCM, and a brand new encoder, no luck. Last night I decided to drain the transfer case. What came out, was a runny brown colored fluid full of sparkles. At first I could barely get it to drain, until I pushed whatever debris out of the way. Tomorrow I'm pulling it.
 
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Update:
It was the transfer case all along. It's locked up solid. I swapped in another case today, and it drives. Now, to fix all the other issues.
 

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