looks like someone switched out a failed H2 transfer case from something that was AWD from an Escalade, Denali's or a Suburban. So you do have AWD you just can't activate the lock function or shift into low. The buttons on you dashboard (other than the diff lock) are useless.

If you purchased a remanufactured GM T-Case not sure your old case would qualify for a core. H2 transfer cases are built well, you might want to see if you can score one from a salvage yard, it wont be cheap, I believe that model T-Case was only used in the H2's.

If you do find one with a bunch of miles there are rebuild kits that have just about every thing that wears including a new chain. I'm actually surprised you don't have a service 4wd DIC warning.

 

That's what I was thinking, and yes it does say service 4wd system on the dash. None of the buttons for the 4wd are functional, they all blink red before going out.
thanks for the help.