Sorry for the delay.. - I had no codes at all on the dash, which is what was really confusing in my case, as my issues didn't match up with the standard problems owners encounter. I had slight resistance, but nothing huge. Every once in awhile, it would seem to catch and be hard to turn, but sooner or later, it would free itself and spin again pretty freely.

When I put in the new [ to me ] transfer case, I was not able to spin that input shaft, I could maybe put a very small turn on it by hand before it simply refused to budge.

For those of you with TC problem...

What was the mileage when the transfer case went bad?

What were the symptoms?

My friend has a 2004 X3 2.5i auto with 165K, well-maintained.

Today the noise is nasty somewhere near the transfer case when driving at 20-30 mph, especially when braking.
Front driveshaft looks good.
Front axles look good.

Where does everyone buy your TC these days?
New is > $2900 at dealer for PN 27103455133!

Can anyone educate me the difference in symptoms of: bad plastic gear vs a kaput transfer case (bad chain, bearing and/or clutch)?

Water can get into the cargo area due to clogged sunroof drains. This happened to be back in January 2021 and caused the transfer case to go into failsafe mode (permanent 4wd, hard to steer) and of course the trifecta of ABS, brake and 4x4 lights were all lit.

It took me a while to diagnose this issue because I had recently replaced the transfer case actuator, some front suspension arms, got an alignment and replaced one rear wheel bearing so I was always suspicious about these repairs causing other problems, I was wrong...

I was able to get the transfer case to 2wd by applying 12 volts into the actuator motors' cable at the transfer case controller (VTG ECU) and then disconnected it. Drove the X3 on 2WD for 4 months. I bought the BMW 1.4 scan tool and was not able to diagnose the culprit. Finally I downloaded INPA and got a cable from Ebay. This software has an actuator and VTG ECU test function, there was no communication with the ECU so I bought an used one from Ebay for $50, replaced it and voila! it works again.
I took apart the old ECU and to my surprise I found out it's not water tight so water got it, corroded everything and created a short circuit.

So...what happens next? What did you yo do to get your solution?

Sent from my SM-A115U using Tapatalk

Transfer case is now working fine. This was an electronic problem solved by using INPA / ISTA and buying a $50 ECU on ebay. The whole troubleshooting journey was interesting.