I agree with danr1 about the shift indicator on the motor (limit switch) but there might be something mechanically wrong also. There is a plate on the back side of the shift motor, made of plastic I believe, that has a few wires going into it. There are three screws around the perimeter (at least on mine) that hold it into position but if you loosen those screws, you can rotate the plate (adjusting where the shift computer thinks the shift motor is) to align it correctly.

Underneath the shift motor, the linkage that it is connected to is shaped like an arrow. I'm not sure if you remember when you had it off last but that linkage points to what position the transfer case is currently at. The positions I believe are as follows. Looking at the linkage like a clock face, 9 o'clock will be 2H. When you actuate the 4X4, it turns 90 degrees counter clockwise to the 6 o'clock position which is 4H. And putting it in the low range rotates the linkage another 180 degrees counter clockwise to the 12 o'clock position to engage 4L. I believe that when you adjust the linkage by rotating the positioning plate, you do it in 4H that way the linkage isn't limited out at either end of the transfer case's linkage range. The best way you can verify the position then would be to put it into 4H and remove the shift motor and see where the indicator is at. Vice versa you can check if there is anything mechanically wrong with the transfer case the same way. If you happen to pull the shift motor when your having the grinding issue that would verify if you have something internally wrong in the transfer case.

There is a well know issue with the oil pump inside the BW1356 transfer case failing. This causes the bushings on the range fork to wear out prematurely. This also causes excessive play in the range fork and can make it to slip into neutral and in turn cause the grinding. Don't ask me how I know because it was a long stressful ride home . Hopefully it's just an adjustment and everything will work out fine. Good luck on checking the adjustment and keep us posted.

Also, welcome to FTE. You can find all sorts of great info and a lot of knowledgeable people around here.