Took my 2007 6.6 Silverado to a guy with Tech 2 Diagnostic tool. He ran process of re-learnig encoder position of the transfer case shift motor and problem fixed.

 

Hey Fellas, All good info. At my city job, one of the department heads drives a 2008 2500 4x4
A few weeks ago, I had to diagnose a problem with the passenger door lock. Thought it may be the actuator, but traced the circuit, and using my Power Probe, was able to lock and unlock door from behind fuse box
(Seriously need to write a thread about this issue)
Any-who...the fuse box was at fault, causing only 3 doors to work. After replacing with brand new fuse box, noticed this 4 wheel drive light on. We have an MDS TechII diagnostic tool. Going to try and look for fault codes and reprogram the system.
This truck has been 1 BIG headache, with electrical problems. Countless issues with going into limp mode and low power light on. Wish me luck.

JT
City of Winter Park Fleet Maintenance.
Winter Park, Floriduh

 

OK, after a complete relearn procedure, that fixed the problem. Using my laptop/TechII/MDS, found the relearn page, under Transfer Case Control Module. With the parking on and vehicle in neutral, I did a relearn in all 3 4wd modes, including neutral(4wd switch ALL the way to the right)
BTW...started out with a total of 7 DTC's, but after clearing only the C0569 remained.

JT