Outer Limits 4x4 Board

Hi folks,
here is a problem with 2001 model Jackaroo (SE 3.0L TD, manual, but I don't think that is the present issue).

Last weekend I noticed the (green) 4x4 light on the dash was flashing, when it should have been off - ie the shift-on-fly button on dash was OUT, and a few judicious doughnuts in local gravel carpark confirmed only rear wheels were driving. 4x4 still engaged correctly (and the light was constantly illuminated as it should be) upon depressing the button, also confirmed on the gravel. Light still flashed upon releasing 4x4 button.

Vehicle has now been with Holden service for TWO DAYS, they have confirmed my conclusions, nothing more. Perhaps it is just a recalcitrant light

Anyways, I wondered if anyone has encountered this, or anyways can shed some light (sorry for pun).

TIA

Stu

Generally if it is flasing on a Holden it means that 4wd is not dissengauging correctly. Even though it is obviously not still driving all 4 wheels, the vehicles computer is not recognising a full switch out of 4x4 mode. My sugestion is that it will be a sensor on the transfer. Maybe faulty or a bad conection.