1999 suburban service 4wd error c0327

mrtelec

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I put it in 4 hi a couple days ago and when I got home today I saw there is a service 4wd light on and connected a code reader to it and it says c0327 encoder circuit. it seems like it is locked in 4wd whether hi or low and the 4wd selector switches are not lit. but light for a second when the key is turned on then go out/ Anyone ever have this happen and is there a way to get it to default to 2wd so I can take it in to the shop.
 
just installed new motor today, had to wait for it to ship to the house. it went in well enough but that video shows them reflashing the cars computer but no one else that I have read about or watched their video has mentioned having done that.
 
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