Sell tranny fluid and inspect its visual condition. should not smell burnt and should be pink or maybe pinksih brownish, but never dark brown or black. Take it for a drive and see if it surges before engaging the next range. Get it to about 60 MPH, let up on the gas and let it cruise in od. If od works, push the od off button and see if the rpm's go up. Floor it when it gets comfortable in a range and see if the kickdown works. Listen for strange noises, etc. while driving. Stop, engage 4wd high, and go to a slick spot of road so you can spin all 4 wheels and be sure it engaged. All that should happen is the t-case should shift, as the truck you are looking at has no hubs, it is a live axle and always engaged. Put the truck in N, put your foot on the brake and shift into 4 low. Drive a little and make sure it works. Then stop, put it in neutral, re-apply the break, and shift back into 2wd. See if the ac and other power features work. Check that the oil pressure's good. If it all checks out and you have a good feeling about it, buy it. Also, If you can get it up on a rack, check for ball joint and tie rod play.
-Jeremy