My shift motor is Now Working!
I had removed it (again) and really cleaned the armature. I must admit my first cleaning was with a Qtip and some alcohol (I didn't want to screw things up). My second cleaning was 100% complete. I used fine steel wool and buffed the copper contacts until they were new and shiny.
I also used the steel wool to buff the contacts under the selector gear cover, and used some alcohol to ensure there was no film on the electric contacts. I used compressed air to ensure no steel wool was hanging around. The Next pic shows small hobby spring clamps holding the brushes against their springs. This makes installation easy.
Looking back I believe my problems were two fold:
1) The plastic stop on the selector gear was destroyed. This in affect causes the selector gear to travel beyond the stop and fall outside the sensors range. The 4x4 module in the rear trunk is then unable to determine the position of the selector shaft (2H,4H,4L) so it shuts down in a fail safe mode.
2) The dirty contacts on the armature cause the motor to work less efficiently. Don't be afraid to clean them good.
To make things line up easily I verified the selector shaft was in 2H and installed the shift motor without the selector gear. I then slid the selector gear into place over the worn gear it only goes in ONE way and slides right on. It will be a PITA if you try to install the unit with the gear unit. I then installed the cover without the bolts and used my meter to verify (2H) continuity. If neccessary Rotate the cover left/right to get continuity. Connect the wiring harness and TEST the system. You may need to reset the rear control module. If ok then install the cover bolts.
Cool info The T-case can manually be shifted. You can removed the shift motor to expose the selector shaft. Rotate the shaft to 4H and bingo, you're in 4H. Rotate it back and your back to 2H, it is that easy. The selector feels spring loaded so you can positively feel it "snap" into each position 2H,4H,4L. So don't be afraid to move the selector thinking it will get "out of position".