Glad you fixed it as I have similar issues with mine being stuck in Low when on High side and select neutral message. I ended up putting the transfer box manually into high and with the motor back in place I took out the transfer box fuse so...
Or it could have been a corroded connector. My practice is always to put the supposedly defective part back to see if the fault reappears.
Good news that you have fixed it.
This happened after I replaced the front drive shafts (after taking hub off) and could it be due to tightening up the drive shaft nuts with gearbox in "Park". I think I have caused something to mis aligne in the transfer box. Maybe the round disc...