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I know it's a different vehicle, but that sounds like what my SRT did when the xfer case motor went out. It would drive, but fought me driving down the street and would bind/pop when turning.

When the front diff went out (dealer F up), there was just a lot of grinding (open diff).

Other side of the coin is it could just need more FM, like you said. I would start there since it's the cheaper/easier option.
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