I'd say change the oil and filter before anything else if you know it's old.
I'm a bit confused about that too. The gearbox and transfer box are to all intents and purposes two separate units. So I cant see how one can affect the other in this manner, unless there's something going on with a loose or worn component near the two selector levers in the transmission tunnel where the levers live.I am confused, as to how the ALL the gears in the gear box can be selected in LOW range but not in HI Range.
Cheers