The book reads exactly as above. When you select 4lo, you have no TC. I don't think the rear locker has anything to do with it. One reason I WOULDN'T like TC in lo is that it's braking. When things are hairy, and you're really struggling to get up an obstacle, you don't want anything clamping down on any forward movement, at all. On a slippery slope in 4hi, you can feel the vehicle slowing down despite having your foot in the go pedal. This is the reason for being able to disable it. For normal driving and great control on a snowy road, it's an awesome system. If it keeps you from making the last ten feet of a hairy arsed ascent, it could be a very BAD thing!
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