I found some info on this site that may be helpful.
http://www.realworldautomotive.com/...ilverado-service-4wd-light-comes-on-t462.html
Chevy technical service bulletin 05-04-21-003C, dated April 15, 2008, discusses a water intrusion condition affecting the harness and gives part numbers for modified harness assemblies and connectors (part numbers vary by vehicle option codes). This problem has been setting DTC C0374 and causing erratic 4x4 system operation on certain Silverado, and additional GM built full-size and mid-size trucks and SUVs ranging from 2003 to 2007.