Once again, thanks guy for the help. I must have read that elsewhere a while ago because the notion of an extended drive shaft is something I had definitely heard before. Makes sense though.

David, as someone who has replaced this female section in the transfer case, can you tell me how much labor this is (about). Also, how do I check if the front driveshaft section is slipping? Is this something I will see if I just get the car on the lift?

Interesting suggestion about turning the wheel manually too. I will try to check it out when I get the chance.