I don't think you're necessarily correct about the T case being at fault. When you engage 4WD, the front driveshaft is connected via the T case gears to the rear driveshaft and the input shaft, so it will not be able to be turned by hand.
Although you said the front axle engaged, try again with ignition on and T case in 4H; this time try to turn the front wheels (jacked up). If the axle has engaged, the wheels will turn in opposite directions, because the front driveshaft is connected to the axles, but cannot turn. If the wheels rotate in the same direction, or only one turns, the axle clutch has not operated.