4wd MANUAL shift issue

[dgndngrngr]

Hi all,

I have a 1990 Bronco II with BW1350 manual transfer case and its been acting up since i bought it. Heres what it does with the transmission in neutral.

2wd = dash light lights up "4x4"
4wd = stays "4x4"
neutral = light goes out
4wd low = lights up "4x4" but not "Low Range"

So I decide to drop the t case and I remove the rear driveshaft first (which spins an 1/8 of a turn counter clockwise after removing the last bolt at the diff).
Then I try shifting through the gears again and all the lights go on or off as they should and even the "LOW Range" lights up when in low.

Whenever I turn onto a street I also get some kind of binding in 2wd. I turn and try to accelerate but the the truck just doesnt go and after about 10-15 seconds theres a loud "pop" in the driveline and I am able to drive it again normally until I have to turn again.

I dont know how many miles are on the truck or the t case.
Its leaking fluid at the transmission housing extension and looks like it was rebuilt before.
I have cleaned the plug on the tcase that signals the light on the dash and there are no electrical shorts in the wire.

Sorry about the long post but I am out of ideas. There are alot of posts about the electric motors on these 1350s failing but nothing about the case failing or problems related to it. The light I could care less about but this binding is driving me crazy, its basically not driveable, and I think the binding and the light issues are related. Ive been trying to figure this out since august and I have no idea. PLEASE anything will help!!!

heres the light I was talking about

heres the original driveshaft

and the one thats on there now (had binding issue with both driveshafts)

 

[4x4junkie]

It sounds like the shifter gate may just need to be adjusted, it might not be allowing it to go all the way forward into 2WD.

 

[dgndngrngr]

thanks, i didnt even know you could adjust it but i just tried that and still didnt work. im just gonna trash it and find another. think i should just stick with the 1350 or is it worth 3 times the price to get a 1354?

 

[dgndngrngr]

nm, im gonna stay with a 1350

 

[4x4junkie]

It definitely sounds shifter-related.

1350s are pretty easy to find, so getting another might not be a bad idea.

The t-case is pretty simple inside though, couldn't hurt to pop it open and see if there's anything obvious as to what's causing it (worn/missing wear pads on the shift fork maybe).