You need a front axle actuator if the transfer case is engaging, and the wheels aren't, as you are saying it is. If that actuator is what you have replaced, try checking the connector at that actuator for 12 volts when the driveshaft is locking up. The actuator gets 12 volts from a switch on the transfer case. There should be a connector with brown, light blue, and grey with black stripe wires. The brown should have 12 volts anytime the ignition switch is on. When the transfer case is in 4wd, the light blue wire should get 12 volts. There is also a switch on the front axle to report back to the module that it is engaged. It will send 12 volts back to the T/C module when engaged. If the module doesn't see this signal, it will flash the light waiting for it. The light will also flash if it doesn't see the transfer case motor go into the range that it commanded. The transfer case control module does NOT directly turn on the front axle actuator, that is done through the switch I mentioned. The big connector on the transfer case motor... Get your test light away from it! There are 5 volt circuits in there, and you could fry your transfer case control module. If the transfer case is engaging, making the front driveshaft lock with the truck in park, the switch is working, at least enough to get it into one of the 4wd modes.