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I have a 2000 F250 with the 7.3. Right now the transfer case is staying locked in at all times with the 4wd selector switch in 2wd. I disconnected both the switch and the connectors going to the transfer case and nothing changed with the exception of the dash light going out (front drive shaft was still locked in). Does anyone have any troubleshooting tips to help me figure out what needs to be fixed? I'd like to take a guess at the t-case motor, but I'd hate to waste money on that if it isn't the problem.
You're sure it's the transfer case that's locked in, and not the hubs, right?
If the transfer case is in 2wd HI the hubs can be locked or unlocked and 4wd will not work. Manually unlocking the hubs will not shift the transfer case out of 4wd. You can try turning the front driveshaft and axle shafts at the u joint to see what spins free.
I suspect either your having issues with the shift motor or the transfer case is just being a PITA. On other vehicles I've encountered stubborn ESOF tcases. Usually I will put the selecter back to 4wd, put the trans in N and then shift back to 2wd. If that doesn't work I will try to do the same thing but with the truck slowly moving.(F or R) I'll try in D, R too. Usually the stubborn ones rarely see 4wd use.