97 Blazer with blown motor that still starts. 4x4 4 door. It has 3 button 4x4 switch. In 2 wheel drive no movement but if I switch to 4x4 it moves???? I have checked trans fluid and its fine. Anything else to look at????? 160K miles

 

The only thing that could possibly cause this is a problem with the transfer case (broken rear output or transfer case in neutral instead of 2HI) or a problem in the rear differential.

Does the rear driveshaft move? If it does, I would open up the rear differential to see what's going on inside. If it doesn't, then the issue is inside the t-case.