I have a '98 Explorer and have learned through experience that the weak link in the 4x4 drivetrain is the shift motor on the transfer case.
This item can cause the transfer case to stick in 4-high or low and indeed between the detents which sounds like what is happening in your case.
If the shift motor is removed you can actually shift it manually by turning the exposed shaft with a pair of vicegrips but a replacement motor is available for $125 or so from your local parts store.
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