Is this true?
I don't purposely write stuff that's false.
When the vehicle is turning the front wheels take a longer path than the rear. (see for example Different wheel speeds in turns - Harald Pietschmann's 4WD basics - http://www.4x4abc.com/4WD101/def_turn.html) If they're locked into turning exactly the same speed, the front tires will be turning slower than the vehicle is traveling over the ground. That's not good for cornering.
First time I've heard this in 40 years of owning 4wd vehicles.
I'm a nerd for technical details.
Not sure how a transfer case could do this on a 4wd vehicle.
Doesn't have to be in the transfer case, does it?