Ok I've done some more testing some of what h82loseejr has suggested. I jacked up the front with rear wheels on the ground, the front line is free. So I jacked up the rear wheels, and with the engine running I shifted into 4hi form 4auto, then back. Same with 4lo. All wheels spin in 4wd modes. To make sure I was shifting back into 4auto, I would shift trans into neutral. Then I would shift from 4auto to 4hi or 4lo...all wheels would spin in idle then I would shift back to 4auto. I would spin the front drive line by hand to see if the clutch was released. Each time the front line would spin free. So it seems to be shifting properly. I check the ground for the 4lo shift motor and it was good.
The indicator lights in the dash are another story. They never come on when I make a shift (that's why I started this thread thinking it wasn't shifting). The 4lo light comes on in key on position, 4hi/4lo come on in start position, running position the 4lo stays on momentarily. If anyone can has any thoughts on the indicator lights it would be greatly appreciated.