This is an interesting training video from Toyota, looks to be early 90's maybe, about the same time as the 80's VC in the transfercase was coming out. This is a good demonstration of how it works. Unfortunately I am pretty sure it is the same fluid as in our fan clutches and will eventually wear out providing no VC operation or like many have experienced it will burn and lock up. I imagine you could tune the VC just like you could with the fan clutch to provide various levels of limited slip if you were very patient to drain the old fluid out and refill......
Interesting part on VC's starts around 17:52
Interesting part on VC's starts around 17:52