I wanted to add my experience to this post. I was having problems with my transfer case engaging also. I would push the CDL and the light would blink fast, and no engagement would happen. I could sometimes get it to engage, but not consistent. I read through the comments here and watched the videos. I ended up following these videos I found on YouTube and was able to get it working. He does not speak English in the video, but if you follow along, you can figure it out. The biggest issue I was worried about was getting the gears clocked correctly. There doesn't seem to be much on how they should be placed, everyone just tells you to take note of the location, but that is impossible for the top actuator. Also note, I did not have the corrosion problem inside the actuators, but my vent hose was split. The hose is only about 6" long and connects right above the actuator to a plastic line. I was able to get some new vent hose and replace mine.
The first video is how to repair the actuator, including fixing the contact points in the housing. I did this on mine.
The second video is how to swap out a new actuator, but keep the shift rods in the transfer case. If you watch both, there is enough information to get fix it.
This is a photo of the position I placed the gears before installation. Make sure the shift rods are pushed all the way into the transmission.
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