I will relate my tale of woe and you can make your own mind up wether it relates to your situation.
Intermittent fault which caused m+s lights to flash, limp mode and disappearance of gear position light by selector and digital display by odometer, usually occurring after driving 20 miles in wet or 30 miles in dry conditions.
Fault logged, gear position monitoring.
Endless trips to garages, auto transmission specialists, Indy land rover experts and auto electricians who replaced, battery, xyz switch and electronic automatic transmission ecu without any lasting result.
I eventually bought a nanocom to try to sort it out myself.
I also did endless reading and searching threads until i had a very basic understanding of the xwy switch and associated circuits.
One day sitting in the car playing with the nanocom the fault occured ie m+s lights flashing but more importantly no digital display or light indicating gear position when selecting D,3,2,1 so I was able to look at the live reading of the wxyz feeds to both the bcu and eat ecus and low and behold there was no feed when selecting D,3,2,1, but P,R, and N were there when selected.
From previous reading I knew that P and N were an earth feed, R has its own feed from fuse 25 drivers side fuse box and D,3,2,1 shared a common feed from pin 10, connector 663 in the bcu.
After much persuasion my local auto electrician who had looked at the problem several times without success agreed to test pin 10 in connector 663 when the fault previously described was present and he found no live feed.
He took out the bcu which looked perfect, dry and no signs of water ingress and opened it, still no signs of damage so concluded that it was just an intermittent age related fault with the switch through which power was provided to the xyz switch circuit.
From previous research I knew that this switch was dedicated to the xyz circuit alone so he wired in a fix which cured the problem for several months until more bcu problems meant that I had to replace the bcu when I disconnected a fuse in the fix and have had no more problems.
To do what i did you would have to remove central console between front seats only.
The input feed path from the bcu to the xyz switch is as follows
N/P (brown / purple) 0.5 diameter wire throughout.
BCU - front passenger footwell
Connector 663 pin 10
Connector 668 pin 3 -main harness by handbrake
Connector 681 pin 3 - harness to xyz switch
Connector 675 pin 8 - to xyz switch.
The output path from the xyz switch for the input from the bcu is as follows
Z path
Connector 675 pin 6 UW 0.5 diameter wire
Connector 678 pin5 - harness from XYZ switch
Connector 728 pin 5 - main harness
Y path
Connector 675 pin 7 UG wire 0.5 diameter wire
Connector 678 pin 4
Connector 728 pin 4
W path
Connector 675 pin 9 UP wire 0.5 diameter wire
Connector 678 pin 7
Connector 728 pin 7
X path
Connector 675 pin10 UB wire 0.5 diameter wire
Connector 678 pin 6
Connector 728 pin 6
When D, 3,2,1 are selected the following wxyz paths are energised 12v positive
D W,Y,Z
3 X,Y,Z
2. Z
1 Y
If you havent got rave search for the following as pdf files and down load as they will help you
Discovery serries 2, workshop manual 1999MY on (VDR 100090 ENG (6) )
Discovery 2 MY99 to MY03 - Electrical library (LR0529ENG 3rd ED)
Discovery 2 Circuit diagrams 00MY RHD.
If you decide to investigate further and remove central console you will find by the handbrake lever the following
Connectors 681/668
Connectors 678/728
and with the information above you can check that the system is receiving power from the bcu and the xyz switch is transmitting power correctly when selecting forward gear positions,, bearing in mind that the fault which causes the digital display and light by gear selector to be absent, not just flashing.