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With the trans clutches coming on/off, all the gears meshing, planetary in the trans and transfer case, chain flopping and spinning parts at right angles to get the spindles to turn, it a wonder they even move. Might work to have a helper working the selector and roll around underneath...

IMO..... Accumulated gear backlash at every point in the power train. Some points more that others. Your on the right track... transfer case, drive line joints, diff's, hubs. I had the same issue and chased, turned, rocked, locked, blocked, removed and replaced components to isolate the...