It should be an electric shift. Pull the motor and move the shift linkage manually. It might take some effort but you should be able to lock it in. Try spinning the front driveshaft, if it's in 4x4 it shouldnt spin all the way. Also check wiring and connections. With the t case grinding it makes me think the motor isn't getting it fully in gear, meaning a corroded wire or connection not allowing full power to the motor, or a weak motor. But it's worth making sure the t case will shift.