Tried to search for answers and all I found was "the shifter is the problem" unfortunately for me it's not the problem, I disconnected the linkage and can't budge the arm on the case itself without using a small pipe wrench, any suggestions?

 

What year. I've heard they bind and need to be taken start and lubricated. Some people add zerc fittings to them

 

If the arm on the case itself doesn't move, there's likely to be an internal fault. There is a little tab that locates the oil pump inside the transfercase, and it can break. It starts spinning around inside the transfercase. It generally leads to all kinds of problem, such as shift fork failure and the transfercase eventually seizing up.

I'd drop the case, take it apart and see what's up.

 

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