it does the same in 4 wheel auto. when I hit the button to go back to 2 wheel I can hear something clicking & the 2 wheel lights up as should
When you push the button and it flashes then goes back to where it was,it means that it won't complete the shift. Most times,you can hear the motor move meaning the system is trying to make the shift. Most times its the Encoder Motor Sensor that needs replaced. I'm pretty sure year 2000 up to 2003 you could replace the sensor only. The sensor is not telling the Transfer Case Control Module(TCCM) that it is to the position requested,so it goes back to the last known position. Just unbolt the Encoder Motor from the Transfer Case,the sensor is under the plastic spacer where the shaft sticks out.
try slowing down and even putting it in nuetral.. sometimes it is operator error
