I've seen the Service 4wd message come up occasionally. The truck won't go into 4wd while the message is displaying. The truck goes into 4wd fine afterwards. I've read a little an am encouraged that often the light shows up often from lack of use. I'm now engaging the 4wd more often just in case it's a lack of use issue. I just purchased the truck and first saw the message 3 days ago. I'm planning on 4wheeling on the hatteras beach in a month.
SERVICE 4WD - INTERMITTENTLY DISPLAYED on 2006 Chevrolet Suburban 1500
by macinric in Potwin, KS on July 22, 2014
ANSWER by bigwic on December 14, 2014
I've actually seen this before and seen other people comment on this too. Apparently, this vehicle has a problem with the drive selector switch. Most people have fixed this issue by just replacing the switch itself. It's been known to be faulty and cause the service message you are seeing.
The 4WD transfer case encoder motor position sensor or the selector switch may fail causing the service 4WD message to be displayed. Fault code(s) stored in the transfer case control module will ...