I saw this exact thing happen back when I worked for the Jeep garage. The Dept of Natural Resources (Game Wardens Office) in WV all ran Cherokees at the time. This one Game Warden was chasing a poacher and when the chase went off road, he tried to engage 4WD at about 65-70 mph. KA-FAWKIN-BOOM! Transfer exploded. Sent shrapnel up into the cab.
When the owners manual tells you not to shift into 4WD at speeds greater than 55, they mean it!
Make sure you check the tranny over real good! Rarely this happens without causing some sort of tail-shaft damage in the trans!