".... Is this switch known to go bad? ..........."
Yes. Not saying this is the actual problem you have but yes the multi-function stalk is known to fail in the TJ....i replaced mine a few months ago but my problem was totally different: the fog lights would come on by themselves......Autozone sells new stalks for $70 and there is a thread on this forum that describes the install process which is super simple.
2002 Wrangler Sahara, all stock, 5-speed, Dana 44, duel tan tops, 2nd owner.
2008 Hemi Grand Cherokee Limited 4X4, Quadradrive II, original owner, 22,000 miles.