Originally Posted by 2005JGC
You may have broken an axle in the front... the torque split in the transfercase is an open style (not technical terminology mind you), so if ANY path to the pavement is lost it will just spin and not send power to the ground, in 4lo it locks the transfercase so you have a dedicated locked path to the ground in the front and rear. Considering you heard the noise up front and your large lift and known cv issues with big lifts on these, Im guessing its an axle up front.
That is what I think too. I would not say 2" is a large lift but it may have an effect. Another piece of information is that I recently had an isolator bushing replaced on the front diff under warranty. The CV boot leaked after that and they had to replace that, which I think entails putting in a new axle. I suspect that they did something wrong (a Jeep dealership) and that it let go during my vacation. With only 39K miles, and on a smooth paved road, nothing should be snapping!
I might get the diagnosis today. A no deductible extended warranty is turning out to be my best "modification."