I had a '97 Explorer, 4wd, automatic
At ~100k miles, I had the same strange noise, whirring while driving, etc. The ford shop said Transmission, I said OK; they did a transmission rebuild, when they went to pull it off the lift at the end of the job, OPPS, exact same noise. “Oh gee, it must have been the Transfer case!” which meant yet another rebuild. EXPENSIVE, to say the least.
To add insult to injury, less than 20K later, the TRANNY DID FAIL, the shop replaced that one with a Ford CRATE tranny (at ‘cost’ with was yet another expensive bill).
At about 190k, the noise appeared again; I traded the car in with out a moment’s hesitation. This was in 2004, the market for old explorers was still good.
Yes that noise is definitely from the transfer case. It is caused by movement of the the range fork. It is a problem with the case halves. Just do a search for the Borg Warner 4405 transfer case noise or problems. Look at these sites for more info.
www.explorerforum.com/forums/showthread.php?t=182071
www.omegamachine.com/