yo A.O.R.C.,
on the ESOF; the top item, circled in re (looks like a horse hoof) is the dedicated speed sensor for the xfer case; it has nothing to do w/the VSS mounted on the 8.8
It has the LG & LB wires
The Brown wire goes to the Magnetic clutch wire
View attachment 11365
Pin Number Circuit Circuit Function
1 779 (BR) Electrical Shift 4x4 Module to Electro-Magnetic Clutch
2 777 (Y) Electrical Shift 4x4 Module to Motor Control Counterclockwise
3 774(LG) Electrical Shift 4x4 Module to Speed Sensor Return
4
772 (LB) Electrical Shift 4x4 Module to Speed Sensor Return
5 771 (P) Electrical Shift 4x4 Module to Motor Position No. 5
6 770 (W) Electrical Shift 4x4 Module to Motor Position No. 4
7 764 (BR/W) Electrical Shift 4x4 Module to Motor Position No. 3
8 763 (O/W) Electrical Shift 4x4 Module to Motor Position No. 2
9 762 (Y/W) Electrical Shift 4x4 Module to Motor Position No. 1
10 778 (O) Electrical Shift 4x4 Module to Motor Control
ESOF
Shift Motor Connector & pin-out diagram
1356 Electric Shift Speed Sensor Replacement Information & in an 89; "Problem: 4wheel LOW was not working. I only got the blinking LOW light when I selected it. Sometimes it would work, but rarely, and without warning. The bigger problem would be when I would try to disengage it and it would not work. Then I'm stuck in LOW. 4 HIGH worked fine. Lo and Behold my speed sensor was showing about 5 megaohms. I grabbed one from a junkyard and it measured 283 ohms. Swapped them out and it works beautifully! Free fix, and it took about 45 minutes to remove the yoke, tail housing, and solder/splice/heat shrink the new sensor in place. I attached a picture of what the sensor looks like when it's out. BTW the sensor I got from the junkyard came out of a Bronco 2 I think...or maybe a Ranger. I forget, but I kinda took a gamble. It looked the same, and had the same color wires. Either way, it only had one bracket holding it in place, instead of a Bronco/F series BW1356 that requires the removal of part of the transfer case. It's much easier to get when you're in a junkyard..."
Source: by kf4amu (Will H, The Beast)
I have the magnetic clutch wire replacement link too by Drinkbrew (Jason)
And here is the ESOF Skinny from Ford; take time to read about that speed sensor and clutch and 4L repairs.
Four Wheel Drive (4X4) General Information, Operation & Troubleshooting TSB 92-1-8 for Bronco, F Series & Ranger (COMPLETE); Includes Electric Shift On The Fly (ESOF) Troubleshooting & Hub Operation; same for 87-96; exc for that in 87; power from Fuse 6 (15 amp) to "ELECT SHIFT CONTROL MOD" WHT-PPL and CB 12 (30amp) to "ELECT SHIFT CONTROL MOD" BLK-WHT; SEE A7 and A8 in the 4x4 diagram, it shows those two wires BLK-WHT as BK/W from SHIFT MODULE to P1 BATTY and and WHT-PPL as W/P to P2 Source: by Ford via Chilton