Yes.

Just above where the driveshaft meets the front of the torque converter there is a "nipple" with a 10mm off shaped nut. The boxed end of a 10mm won't fit but the open end will. If memory serves you turn counter clockwise (laying underneath) to engage and clockwise to disengage. It clicks at each stop.

You have to just feel for it.

 

Charlie, do you mean transfer case instead of torque converter?

 

Well, drove almost 150 miles today combined on/off road. Car did great. Have about 300 miles since oil and coolant change with no discernible loss or mixing. There is the slightest hint of white smoke for about 20 seconds after starting but it is really very very minimal. Surprising considering the mileage and the fact that the last owner had it for 8 years and drove a lot and never did hg's

 

Some thoughts here...
I know that these shocks are toast, and often hear people mention that the springs can sag a bit over time so I am thinking that it since new shocks are half the price of a lift kit, I may as well just go for the lift since I would eventually want one anyway. The tires that are on it are cheap ones and they have about 50 to 60 percent tread left in the back and 20 to 30 percent up front
I'm debating going and getting tires now that are the same size (265/70/16) or waiting to do the lift at the same time and going with something larger. The majority of my off road driving atm will be mainly deep sand

I just don't want to open the can of worms that comes with lifting a 308k mile d2 right now since I'm dumping money into it from all ends trying to fix up other things and I know that I will add more wear and tear on the other parts. Am thinking I'll rebuild the driveshafts soon too as I notice a tiny clunk when I give it gas from coasting

EDIT:
Tentative Plan-

As far as the suspension goes, what i think i will be doing is taking it easy on this one - It seems like the lift + larger tires will put a bit more strain on things driveline and suspension related that i'd rather not risk this summer as my other cars (335i & 135i) are all in need of repairs and i'd rather not spend the whole summer wrenching when i could be driving.

Since I need tires and shocks, i think i will do the terrafirma shocks along with 1" spacers to give a hair more clearance and 275/70/16's . My main criteria for the tires was just being at least the size of a stock rubicon, so thats what it will take. When i was out at the beach yesterday, there was a pretty steep and soft trail over the dunes that led to a kind of "secret" beach that i saw a rubicon go over. Due to my three amigos open diff situation and crappy tires i didn't dare

I also just got a nice set of sand ladders and a shovel, i really want a high lift jack as well but would need a place to put it. Would love a rack on top but the OEM ones are big $$$, and the universal ones could be made to work but all of them were too narrow. I just hate the look of crossbars sticking out past the rack, but i suppose i could always find the widest carrier possible and hack the crossbars beyond it, then mount the jack, shovel, ramps etc to the sides to fill in the gap

Trying to keep this as cheap as possible but without being "ghetto" so i can save for another D2 and do things right when the time comes, and bigger turbos for the 135

 

Update, was just poking around replacing some parts and saw that my hose to the water pump is swelling like a balloon animal when warm and has the texture of a sponge when cold. Thinking it's time for hoses. All the others seem good though

Also, one of the guide pins on the caliper carrier is seized so I'm just going to hit the parts yard tomorrow and grab one. The frame rot is worse than I thought too. Oh well, if I make it through the year I'll be happy and swap everything onto the next d2

 

Was just at the local junkyard and in one of the d2s they had, the engine was out and the driveshafts were in the passenger seat. The front looks newish with greaseable u joints. I can probably get it for 50 bucks. Should I? Also got OEM cup holders for 10 dollars a pair, the wife was happy

 

Always good to have a spare. If it articulates in all directions without the slightest catch or sound I'd take a chance on it.

 

Am now at 309,300 miles. I've put 1200 on it in the last few weeks. Still haven't had time to mess around with it too much but it's about time to make it inspection friendly and get rid of some of these codes. Added a decent sized universal cargo basket and brush guard, hella 500s wouldn't fit without spacers and I didn't have anything suitable at home so I just installed the 20" light bar for now which fit perfectly on the OEM fog light holes. Next up will be tires, still eyeing the cooper adventurer in 265/75/16 as they have such a good special at pep boys but am also looking at the mickey Thompson baja stz now and trying to figure out if it's worth the extra 200 dollars. They seem to have a very low void tread that might be more suitable to sand driving which is mostly what I do. Also, my local home depot has exide group 27 deep cycles on sale for 75 dollars, 730 MCA with 180 min reserve capacity so I may spring for one of those to make sure it's fresh as the one in there looks ancient. I'd like to be able to run lights compressor etc with the engine off and not have it idling any more than it needs. Speaking of idle, it's a bit rough and I have been watching the vacuum fluctuate a good deal as the idle so that will bear investigation

 

Now at 313k miles. Running like a champ on Rotella 15-w40. Come spring time I'm going to patch the floor cancer and seal off the sunroof, then coat the floor in bed liner. This thing just won't die

 

I love it. Keep us updated.