After getting my new AWD Disconnect assembly installed I disected the non-functioning 4WD disconnect.
Looks like some salt water from driving on the beach earlier this year got into the disconnect thru the actuator hole in the housing. The shifting fork was stuck in the 2WD position. I had to drive it out with a hammer. All other components were in good condition with minimal wear. The actuator plunger spring must have just compressed all the way when I was in 4WD as the selector light never blinked and acted normal.
You can see a little rust and corrosion in the actuator hole.
Corroded shifting fork, rust on the post and aluminum corrosion on the bottom.
Corroded housing hole.
Little rust on the gear.