2000 Silverado 1500 keeps showing Service 4WD light... we replaced the switch in the dash, the encoder motor on the transfer case, the actuator, the module behind the switch, checked the ground wires, traced all of the wiring... nothing's worked! :mad:

Occasionally, when you switch the key on and off, the lights on the switch that indicate what gear the transfer case is in will flash but go out immediately... most times they won't light up at all.

Any suggestions?

Are you getting a code, B2725?
There is a bulletin, # 02-04-21-004, that addresses that concern.
The condition may be due to an intermittent fault in the transfer case shift control switch. Did you use PN 15709327 as the replacement? If so, the next step is to rule out everything that isn't the control module.
Close visual inspection of all connectors, from the switch all the way to the motor, is crucial, making certain there is no water intrusion or other contaminants. Pin fit in each connector would be another test. Verify total circuit continuity.
The next step would be to diagnose the IPC internally for logic gate fault. It sounds like you've ruled out the common items.

We haven't gotten any codes whatsoever. We actually just got the selector switch warrantied, used the GM part both times. We did check all the connectors because we've seen melted connectors plenty of times; it seems so ssimple and stupid but that's all it takes these days. We made sure there's power and ground circulating through all the switches.

We're really leaning towards the transfer case shift motor, which GM refers to as the encoder motor... we've put in 2 rebuilt aftermarket motors already but each time we pull them out and run power to them, they barely move. We're hesitant to buy a GM motor because once we plug it in, it's ours whether it fixed the problem or not.