help with k1500 4wd problem?

I have a 1998 K1500 with the selectable (2hi button and 4hi/4lo button) 4wd with the nv243 transfer case and would appreciate some tips on what to look at to fix the 4wd hi. It gives a dtc code 2 when pin 13 is
shorted. It always shifts into 4lo and when it does give indicator lights that it has shifted into 4lo both the 4lo and 4hi lights are on. It always goes into 4lo but doesn't always turn on the lights in the switches in the dash. I know it goes into 4lo because I'm stuck in the snow at that point and would not get out if I didn't get 4 wheel drive, and before the snow started falling I jacked up the front end and checked when the front end locked and unlocked. 2hi does not light when 4hi or 2hi is pushed but you can hear the encoder moter shift the transmission into hi range, the front end unlocks (both 2hi and 4hi), and it does go back to hi side of the transfer case. So far what I think I know about this system (jump in if I'm wrong) - The front actuator is working as well as the t-case switch since the front end locks properly in 4lo. The speed sensor is working since it will not shift in or out of 4lo unless going very slow/stopped. The t-case, 4wd, gauges, illum, and ctrsy fuses are good. The tccm dumps the dtc 2 code and replaces with dtc 1 code when fuse is pulled, dtc 1 goes away after the 5 cycles of the ign switch. dtc 2 comes back after some number of trys at going into 4hi. The encoder motor is working since it does shift to 4lo, and it's been replaced by a rebuilt unit that acts just the same as the origional. The t-case relay is working since I have 4lo. 2 things I am really certain of at this point - I miss my old truck with the t-case shifter on the floor, and I have no clue where to look next to try to fix this. I was going to take it to my local chevy dealer and have them at least diagnose it and see if I could afford the repair at this time of year but the service manager there wants an open checkbook if I bring it in and says if I can't afford to fix it I shouldn't be driving it so guess I'm on my own with this one.
A big thanks in advance for any help you might have.

Add pictures here
<% if( /^image/.test(type) ){ %>
<% } %>
Add image file
Upload is a website by car enthusiasts for car enthusiasts. It is not affiliated with any of the car or spare part manufacturers or car dealers discussed here. All logos and trade names are the property of their respective owners.