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Re: 95 gr. cherokee steering problem
If you have the 249 transfer case with all-time 4wd (you'll only have 4hi-n-4lo oon the range selector) your mechanic is on when he says it may be the transfer case. The viscous coupler (search for that or 'VC') is notorious for going out on those, and when it does, it locks up the front and causes it to make the noises described. A little scuffing at low speeds is normal because of the way the system is built, but mine on my '94 got so bad that once warm, just holding the wheel over while stopped would cause a knocking noise and a pulsing feel from up front. . . . . my 
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1994 Grand Cherokee Laredo -- 164,xxx mi
-- My workhorse. It starts when nothing else will! 
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1996 Saturn SL2 174,xxx mi
-- My little E85 experiment!
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