OK, I just solved a mystery. I hope this is helpful to any of you with an NP203. I recently took on a relatively small task of replacing the rubber transmission mounts on my truck. Cheap enough. Didn't look like much work. Three weeks have gone by and the new rubber mounts are still in the box. While removing one of the two bolts that holds the transfer case adapter to the crossmember where the mount goes, the bolt broke off into the transfer case adapter. I couldn't get the broken fragment out with an extractor, so I had to remove the NP203 and adapter. One week goes by. I tried to extract the bolt (now with a broken extractor in it) with NO luck. I find another adapter from a guy on Ebay and get it home. Meanwhile I take a peek inside the NP203 on my garage floor and find some little roller bearings rolling around inside the case. I decide to disect the NP203. Another week goes by. Now the transfer case is completely dissassembled : http://www.cooknwithgas.com/NP203parts.jpg I realize right away that I have no idea how this thing works, so I start to study it. After reviewing the exploded view of the NP203 I realize that my NP203 is different and that these little bearings I found have no place in a factory NP203. Here is what the shrapnel looks like: http://www.cooknwithgas.com/badbearing.jpg It didn't take me long to see other differences with the factory NP203 and mine. Oh, yeah, another week has passed. The previous owner apparently installed an aftermarke kit (Nothing like I have heard of here) with a big metal contraption that mates to the output shaft and also required a cheap little thrust bearing to keep it away from the other gear. The bearing was chewed up by the differential gear that it was riding against. (Predictable) After studying the problem, I decided to weld the kit part to the output shaft to keep it away from the back diff. gear. This makes it similar to the "shaft" kits I keep reading about here on the board. It will also keep it away from the gear that chewed up the bearing. Everything else looks great inside, so I take back all the nasty things I have said about the NP203 and how the part time kit can ruin it due to lack of lubrication. I think this just might work. Conclusion - don't install one of those part-time kits that locks the spider gears. This kit also includs the thrust bearing that can get chewed up (see picture above). Go with the shaft kit if you want to convert to part time 2wd. This keeps everything in it's proper place. Thanks for all the help I received while looking into this.