4wheel drive will not engage, encoder?

It's not in the transfer case, it's on the front differential

My mistake,

I did more research and found this exploded view of the front differential, you can see the fork and slider assembly, same theory but different location. See number 11, 12 and 13

You are using GM parts ?

Let me know what you find.

Best, Ken

i don't think so Just parts from the local auto zone , could you find the right part for me?

Yep no problem, here is one from Amazon

http://www.amazon.com/ACDelco-D3984A-Professional-Wheel-Actuator/dp/B000IYU47M/ref=sr_1_1?ie=UTF8&qid=1432659916&sr=8-1&keywords=ACDELCO+Part+%23+D3984A

Factory parts work so much better than cheaper ones :-)

Please let me know what happens

Best, Ken