4wd problem

Truck in Chevy dealership, 4wd lights blinking, won't go into 4wd, or 4wd low, drive in All-wheel drive only, dealer said the modulator[?] was bad, then called and said that the actuvator [?] was also bad, do both go bad together,changed the dash switch last year, is this something that the truck computer would show, looks to me like they changed the modulator[?] and it did not fix the problem [but what do I know], bill so far is $1200.

*Gently pats the shift knob on his manual transfer case.*