I had that dreaded display message pop up over the summer, it was quite the ordeal to get fixed.
At first, my truck was stuck in 4 high, so I limped it to a nearby shop that I trust. They installed a new control module and sent me to GM to have it programmed.
After GM programmed it, I made it maybe 10 miles down the road, before it kicked back on, so I turned around and went straight back. This time, they said the connections were dirty and the message went away right after they cleaned it.
On my way home, roughly 20 miles away, the damn message came back on. I turned around and went straight back. This time they said they got a code and that it was the transfer case actuator, and replaced it. All was good after.
Fast forward one week, I am towing our 5-6k lbs boat to the beach, roughly 3 hours. After I arrived, the truck started acting funny, like the transfer case was engaged but the hubs weren't locked, and the display came back on with service 4x4 intermittently. I tried to have it checked, while at the beach, but none of the dealerships could fit me in.
At the end of our one week vacation, I was towing the boat down the road trying to be easy and hoping the 4x4 wouldn't act up again. Unfortunately, about an hour into the drive, the same thing happened as I was finally getting onto an interstate. I was watching my transmission temps and could hear the whine of the drivetrain while being unable to get up to speed. The transmission temps jumped up into the 260 range before I could even get pulled off the road. What I figured out, was my transfer case was jumping into 4x4 LO but not locking the hubs!!!!
The Temporary Fix: After pulling over, I turned the truck off, and disconnected the negative cable for about 1 minute, just to reset the system. Once reconnected, I started the truck, and the display message had cleared. Without doing anything else, I immediately pulled the transfer case fuse. That solved the problem and I was able to safely tow the boat the rest of my journey home. REMEMBER THIS IF IT EVER HAPPENS TO YOU.
Once home, I went back to the dealership and they found "something" had rubbed my transfer case wiring harness causing a short. So when it would make connection, the transfer case would jump in and out of low range, without being obvious to the driver. Remember, no trouble lights ever popped up on the dash, just a short message saying service 4x4, and my control module said I was in 2 wheel drive.
Fast forward several months, I am doing my regular maintenance on my truck and I located a crack in my transfer case housing (mostly superficial). It doesn't seem to be leaking, but I can only assume it had something to do with heat during that whole experience. I also assume, it did some serious wear and tear on my transmission. Moral of the story, don't be a fool like me and try to limp your truck when you know something in the drivetrain isn't acting right; especially when towing. I don't even want to know what this is going to cost me over the life of the truck.