The sensor is likely the one that you removed already. I would not expect to see a code for a malfunctioning VSS. When it starts to screw up, it will likely push other codes (ABS most notably) and will really cause driveability problems that are quite pronounced...

If replacing the sensor does not work, then you'll likely have to dig into the wiring from the sensor to the PCM to get it figured out. I can post the pinouts tonight (can't from work) if I get a chance.

Here is an image of your transfer case (NV233) from the top showing this sensor:

 

Thanks alot swarlkk that will be great and then i will start from there.!

 

schematic:

 

i had a problem similar to yours with a bravada and it ended up being the wires for the vss. The speedo wouldn't work and it wouln'd shift out of first gear and it still had reverse. you can use an ohms meter to check the resistance of the vss to see if its good. and you can test the wires individually to see if there is a break in one of them. if the wires are good and the sensor is good and there is no power to the vss it might be the pcm. if i remember right the wires are in the blue plug.