You can still have the light, but it is not needed. As when the transfer case goes to 4x4 its in. Unlike with the stock system that had to wait till the sleeve was moved over the axle shaft for the front to work. Many ways to rig up a switch to turn that light on.
Yes u can still have a functioning light, I do. All u have to do is get the TC switch off of an xj or tj, they're like 15 bucs brand new. Take out the old vacuum motor and all vacuum lines that connect to it along with the switch on the TC. Then take the 2 wires that connect to the actuator on the axle and pull them back around/ over to ur TC where the old switch was. Pull the old switch out and connect those 2 wires to the new switch and spin ur new switch into the TC. For 15 bucs u can still have a functioning light, if u really wanna be cheap go take the switch off of one at a junkyard. All the switch is is a connector with a small ball on the bottom, when u shift the TC is punches the ball up sending a signal to turn the light on, everyone u put the TC in a gear u the linkage hits the ball and send a signal I activate the light. Pretty simple and only 2 wires.
If you don't do anything but replace the axle shaft, the light will still work. The light is not a function of the axle shaft, but rather the vacuum switch.
Just leave the vacuum switch in tact.
You would just leave everything attached. That is what I have, 1 piece axle shaft and I just left everything else there, and I have the dash light and a 1 piece shaft and it was truly that easy.
That switch will work with all of them. If you look at the second post in the thread below there's a Dorman part number. You should be able to find that switch hanging in the "Help" section of any parts house for $12 or less. The pigtail part though they may need to order, but Napa carries a lot of those types of parts as well. As for wiring it all you are doing is switching a ground, so run one side to ground, the other to the wire coming off the current little blue vacuum switch on the firewall that goes to the light and bingo bango you're all set.