Your Push buttons could be bad, or the actuator that locks the front in is bad. I don't think it has anything to do with your trans. Now, when I had my GMC the service 4wd light would come on every 3000miles. I got tired of it and just changed to fuild in the transfer case. Later on my truck wouldn't shift into 4wd and the buttons would blink on the push buttons and once I changed them out everything worked fine.
04 Silverado ECSB 5.3
True dual Magnaflows, K&N airintake,Vararam Volocity stack, SLP performance Diablo Sport 2 Predator programer.