there is a jumper plug near the steering column might be taped to the harness that connects all your data lines to the data bus. they are mostly green wires with a white or yellow stripe. you might have corrosion in that socket.
good explanation here. similar truck to the h2 inner workings

 

Many thanks to you Bronxteck for the info! I am heading in that direction now to look for the Jumper. The video you attached is great! I may have to find a shop nearby that has a picoscope and get the modules scanned that way as well.
Again, thank you for the help!

as a side note... did you happen to see the codes that I posted? just curious

 

yeah they are mostly U codes that's why i posted the info. the plug i believe has a green cap and i think it is located above the E-brake kinda behind the side dash fuse box at the drivers door

 

Okay and again thank you! getting my crawl on now so i can get in there and look

 

Look here:

 

possible bad switch? I've started to take it out of the dash to look it over. I did look at the old TC encoder motor after I had it on the bench. I couldn't get fluke meter readings that made sense and probed it out with my power-probe and a 12v battery. it wouldn't do anything with power applied. tried moving it with a crescent wrench and it really feels like it may be seized. it has definitely been in some water and mud.

I hope to check the switch tomorrow.

Thank you for the help, much appreciated!

 

some here have disassembled the encoder motor, cleaned and lubed them. something about the grease inside the gear housing gets hard and gummy. and the switch.

 

Correct and with the very low gear ratio inside the encoder, try to turn it by hand will probably just break the gears inside.

 

Been a while since I've posted an update on the 2003 Hummer H2. I want to say before I get into the Hummer, I hope everyone is well and the winter storm didn't cause too many problems for everyone. Now, I checked the transfer case switch and went ahead and tried a known good switch in its place from a friends chevy truck (he's overhauling engine and trans) . no joy! I then replaced the encoder motor to see if it made a difference, and again, no joy. I did check the jumper plug along the driver's side kick panel behind the e-brake. looked clean on plug side and the green jumper cap. cleaned with electrical cleaner and reassembled. cleaned a lot under the console, checked connectors, etc., still no joy.
I still have the abs light and the brake light. the transfer case switch will flash it lights, does nothing, also unable to get transfer case into neutral by pressing the 4hi and 4low buttons simultaneously.
I ran another scan on all modules and this scan came back with only one code across the powertrain, anti-lock brake system, airbag, body control module, shared address module and the code is the U1000 class 2 data link malfunction.
now thinking i have a module that's fried. maybe start checking the connectors on body control module and ecu?

 

yeah you would have to start tracing modules. start with the ones that are not functioning as they should. for me my u1000 code was from a dealer installed sirrus xm module that went bad. another one that can cause issues is the on star module. but it can be any module. try disconnecting the ones that might be suspect for your case. that green connector ties most of the modules to the bus. maybe you can see if any of the pins are pulled to ground then figure out what module it feeds from a schematic.