I think that your 4w lo should be fully engaged assuming you have followed the proper method in terms of gear shift, etc. The control trac "stuff" only really deals with the auto mode which looks at front / back drive shaft differences, etc to determine the clutch engagement in the transfer case basically operating the "brown wire"... I think.
Further... I had some time to get at my reference material... here is an excerpt... hopefully it helps more.
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The Dana 35 IFS axle used on the Explorer utilizes a disconnect mounted on the axle housing. The disconnect consists of a shift motor which operates a shift fork and locking collar, an indicator switch which operates the 4WD light on the instrument panel, a vacuum switch and a vacuum harness.
The disconnect is located on the right-hand side of the axle housing. The disconnect divides the right axle shaft into three main parts:
1. A constant shaft which is attached to the hub via a CV halfshaft and joint.
2. A shift fork and collar.
3. An inner shaft attached to the differential.
The left axle shaft is another CV halfshaft and joint and is connected straight from the differential to the wheel hub.
The four-wheel drive has two modes: low and auto. Low mode is used to increase torque for extra pulling power. The auto mode senses a slip condition and automatically engages 4WD similar to the Aerostar by distributing torque between the axles.
When the 4WD mode is selected, a signal is sent to the generic electronic module (GEM) which energizes an electronic valve located in the right front cowl that draws a vacuum on the disconnect shift motor.
The 4WD locking collar on the transfer case engages the front driveshaft. During this time there will be a 3- to 4-second delay while the inner shaft comes up to speed. The vacuum that is drawn on the disconnect motor moves the shift fork located inside the disconnect housing against a locking collar and slides it between the inner shaft and the constant shaft which locks them together and puts the vehicle into 4WD.
To disengage the transfer case, select the 2WD switch position. This will unlock the transfer case and reverse the direction that the shift motor moves the fork which slides the locking collar from between the inner and constant shafts and disengages them.
Since there are no outer hubs to lock on the Explorer, backing up the vehicle after shifting into 2WD is not necessary. Nor are there any concerns with ratcheting or buzzing noises. Differential motoring torque is not an issue either. Nor does the axle require expensive synthetic lubricant. The Dana 35 IFS axle used on the Explorer utilizes a non-synthetic Unocal Thermal Stable Lubricant (Dana No. 44684).
