Okay, driving with the hubs unlocked can freak out the tod system if the ecu notices the front tires spinning at a different rate than the rear tires. Your tire sizes (from front to rear) may be off slightly from wear & the TOD is noticing the difference. The TOD system can't make a change if they are free spinning in the wheel hub and could keep trying over & over.

If you are running your hubs unlocked with TOD engaged, you're losing power to the ground & not saving wear & tear because the axle is still spinning.

There isn't a 4x2 mode, just AWD & 4low. I would look into the off switch if you really want to run the hubs unlocked. Like I said in my first post, there are only a few advantages to running 2wd + hubs unlocked all the time but its a much better idea than just running hubs unlocked