So my choices basically are to either spend 300$ on two new sensors or spend $500 on a used transfer case with used sensors that might be ok?[/QUOTE]

You just searched under Vehicross....go back to car-parts.com and search under, 2001 Isuzu, Trooper 2. transfer case, then look for "with torque on demand" or w/TOD. It is the exact same tranny, transfer case, and sensors as your car.... all wrecking yards may not know this. I think the price goes up when they get in a car like the VX and they think its rare. I just visited the site and there were many t/c's in the $200 range with one listed for $150and another for $175. They were both in California, but these places will ship via truck cheap!

Revisit the site and you'll see....be sure to confirm that the sensors ands connector wires are still in place...