I know I hate to take a vehicle into the stealer but sometimes that's the only resort. IF you can get the codes / status of the "service 4wd" when it lights, that would certainly indicate what and where to look. Of course, if you could find someone with a tech2 to help you, that would be an alternative.
Some more comments on your "test report". When I try the same "exact process" as you have outlined.... key on, turn switch to 4wd (lo), tc switch light flashes for ever unless I put shift the tranny to neutral and then it takes a bit before things "clunk in". If I turn shift the tranny back to park and turn off the ignition... then turn it back on and try to turn the tc switch to 2w drive, it stays at 4wd. If I shift to neutral (brake on), it still stays at 4wd and will not go into 2w. I have to start the vehicle, put it in neutral and then switch the tc switch to 2wd to get there. Not sure why the difference but maybe because some components are "bound up" during one direction and the reverse direction is not achievable directly. I am not always able to hear the motor switching (bad hearing maybe) but do hear the front disconnects happened when things are set right.
I can't remember in all this, whether you did all your electrical checks at the connector of the motor.... The two for powering the motor would appear to work, the two for the brake enable likely work as you are hearing motor noise. The question would be the two for the position sensor / reading. If those two have issues then possibly the TCCM would not know where the state of the motor is. Although it is my understand that an outright failure of the pair (broken or shorted) would cause a code / service 4w indicator at key on / start up, not sure how true that is. IF it is, that would tend to point to the transfer case physical issues.... which likely means dropping to find out more.