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The torque converter idea is a good one. I Got a nice truck for free, because it sounded like it had a rod knock in the oil pan when at idle, but once the revs were raised, it went away. Turned out to be loose bolts between the flex plate and converter. There should not be much room for movement...

You are supposed to turn off the engine when changing transfer case positions. High Lock is only for driving on loose ground, not pavement of any type.