Let's clear up a couple of things... some of this is repetitive of info given above, but for clarity sake....
The Trailblazer SS and Saab 9-7x Aero have a completely different AWD system. It is a purely mechanical, "Torsen", style AWD transfer case. It has a standard bias that applies a fraction of torque to the front at all times (
@Mooseman mentioned 60/40 split). This system is VERY much a differential, when a slip condition is present, torque is directed towards the wheels with the most traction. There are no electronics involved in this process. Many actually call the transfer case a differential instead of a transfer case, because that's what it is. This system is also nearly bulletproof.
In all other cases, the transfer case is electronic. There is a motor that shifts the tcase in and out of 4x4. In non-AWD vehicles, the tcase is two speed. The electronics are interlocked so that it cannot go into LO range without being locked into 4WD. ANY time 4wd is commanded, the front differential disconnect is engaged so that the front output shaft on the transfer case drives the actual front differential instead of spinning in the disconnect.
In AWD vehicles, the front disconnect is never disconnected(I'm not sure if there even is a "disconnect"). The motor that shifts the tcase into and out of 4x4 is what gets actuated in a slip condition. It happens very fast and works very well in a healthy vehicle. There is also no LO range. The transfer case is single speed only. That the front disconnect is never disconnected creates drag loss negatively impacting fuel economy.
(Circling back) In ordinary 4WD vehicles, the setting marked "A4WD" is a a mish-mash of 4wd and AWD. It connects the front disconnect (like the AWD vehicles) as soon as the setting is selected and then monitors for a slip condition, engaging 4WD when a slip condition is sensed. For reasons unknown to me, this tends to cause the "slip-bang" that everyone dreads and can lead to "grenading" drivetrain components.
I have an AWD and have never experience anything but traction. When I do have a slip I notice when the AWD kicks in, but it's smooth and quiet and I can just "go".
Things to keep in mind:
The rear differential makes a HUGE difference in traction. Open vs Limited Slip vs G80 (Locker) will materially affect how much traction you actually get.
Maintenance is KEY. If tcase fluid isn't changed at appropriate intervals, the clutches inside the tcase "stick"... in a 4wd tcase, this may not be noticeable most of the time, but in an AWD it cause "crow hop" and will very negatively impact drivability at low speed. It also causes excessive tire wear and noise and wear and tear on other drive line components.
As for the NP126 and NP226 both containing a low range... this would be the first I've heard of it. Were it true it would mean there is potential to mod AWD vehicles to be true 4x4 and I've never seen any such mods anywhere. I HAVE seen mods to selectively engage AWD instead of letting the TCCM do it, but that's all. I'll look around though.