Well put Rik.
Here you can see the difference between the two plates. The one that is rounded is the YJ plate and the one with the dip in it is the TJ plate.
Thanks for posting that Bob. Saved me the trouble of snapping a pic.
So in the pic you can see the slot in the plate.
That slot controls the front smaller mode fork that engages/disengages the t-case main output shaft to the transmission by a set of two gears in the planetary just behind the t-case input gear. The t-case imput gear drives the planetary gears and when engaged, the planetary drives the main t-case shaft.
The neutral position puts the drive gear on the main t-case shaft between the two drive gears inside the planetary that is driven by the input gear/shaft from the transmission. Between the gears is neutral, either forward or to the rear of the neutral position is the t-case engaged position.
So the slot just engages/disengages the transfer case from the transmission by how it places the smaller gear in the planetary with the smaller forward mode fork.
The chain is still connected to the main ouput shaft, and that output shaft is directly connected to the rear drive shaft, so the front drive shaft will spin because the rear shaft is pushing it.
When you put it in two wheel drive, the rear mode fork lands the sleeve on a single gear that disconnects the front driveshaft. In the picture that is the smallest bump on the lower left corner next to the big dip in the middle.
On the stock plate you can see that the arc is long. Right in the middle of that arc is neutral, but it only moves the front mode fork because of the slot. You can see how the slot does not follow the outer edge.
In the modified plate, the dip allows the large mode fork to move to a position where the sleeve lands between the 2wd and 4 high in a place where the gears spin independently of each other. Now the front yoke is no longer driven by the main shaft at all.
I know it sounds confusing, but when you have it sitting on the work bench and see it in action it all becomes clear as mud.
I don't know what other t-cases it works in. It works in all the 231's. What does the TJ use? The plate is a copy of the TJ one.