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After reading the TSB about transfer cases failing due to non-matching differential ratios I took a look at mine today. Both front and rear have a 2.81 sticker, so at least in my case this was not a contributing factor to the failures. In my case I am on transfer case #3. 1st was about 60k miles, I rebuilt it and it went again at 85k miles the same way. And now I'm rolling past 100k on #3 which was purchased when BMW dropped the price to $700 awhile back.
As a side note, I think my rebuild would have lasted quite a bit longer had I replaced the input shaft along with the output flange that stripped out. When it went the second time I compare the new and old input shafts (since I had a new one available from overseas by then) and found the old one was definitely worn excessively, which certainly didn't do the teeth on the output flange any favors. If (or should I say when) the 3rd one goes out I'll be rebuilding again and replacing the main shaft since BMW has upped the price back up to the $3k range for the TxC. Should have bought a half dozen of them when they were cheap!!
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