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Took my X onto the beach a couple weeks ago surf fishing. First time I drove on the beach. Right before I got on the sand I flipped the dash switch to 4WD. Drove on the sand without turning for about 1/2 mile. Decided to cross over the ruts toward the ocean and got about 75 feet and I'm stuck!
Another guy passes driving an F350, says he can pull me out. He got no where. Then while he was watching me back up a little, he noticed that my front tires weren't spinning. I manually flipped the front hubs to lock and eventually he was able to pull me out while I gave my X a little gas.
I checked the manual and it states that there should be a dot and the word "automatic" on the front hub. The hub has to be in the automatic position for the dash switch to work. Well my hub doesn't have the word automatic anywhere on either hub. There's a LOCK marking and a FREE marking.
No wonder I got stuck the front hubs were never engaged. I locked the front hubs manually the rest of the trip.
Sounds like you have aftermarket manual hubs. Post a pic and some of the more knowledgeable folks here can tell you what brand you have. Your switch on the dash will only engage the transfer case since the electronic shift on the fly was removed when manual hubs were added.
You don't have stock hubs... you should have a "Lock" and "Auto" position on your hubs if there stock. Although you will find many of the stock hubs don't say anything on them because the lettering comes off over time. You still can shift on the fly, but only if you keep the Hubs "locked" ahead of time. Hope that helps...