Glad to hear I thought I was going to have to tear the transfer case apart. I started the diagnostics and found that my CV joint in my rear driveline was squealing. Looks like it dried out and heated up the rubber seal. Just sent it back to Tallon's Driveline Service for repair. Just a coincidence it started during towing. Thanks!
In the future, just keep the centering ball greased. I believe Tatton's sends out all of their shafts with greasable Spicer centering balls. I grease both the front and rear after every wheeling trip and every 3k miles. It's especially important if you daily drive or flat-tow the rig. That's a major mistake people make--that centering ball is doing a lot of work and needs to be kept lubed up.