I am sure it can be towed. It is most likely set up like the H2. There are 4 transfer case settings: 4HI, 4HI-LOCKED, 4LOW-LOCKED, Neutral. The literature of the H3 has mentioned 4 settings. To go to a neutral transfer case for towing, from the 4HI mode you press the 4HI-LOCKED and 4LOW-LOCKED buttons simultaneously.
If you can find a closeup picture of the T-case controls of the H3 there should be some type of extra markings on those two buttons to indicate Neutral.
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