Posting a problem and solution as I wasn't able to find reference to my particular situation on the forum. Note there are other cases of ABS system error states related to LED dash bulb replacement but this is a bit different.

I took my truck off roading a few weeks ago and incurred some unexpected body damage to the right rear quarter panel and right rear taillight. Took it over to my local body shop for the repair.

When I got the truck back ABS, VSC, and TRAC lights were all on. I've done the AndyMod in the past so at first thought maybe one of the techs accidentally tripped the kill switch. However I'd never actually seen the ABS light on when the VSC and TRAC are de-activated via the AndyMod. Asked the body shop to pull the ABS codes for me (different system than the OBDII) and received a whole bunch of codes back:

C1207 - P/R Range Switch
C1223 - ABS Control System Malfunction
C1269 - R Signal Circuit Open
C1340 - Open Circuit in Center Differential Lock Signal

As it was getting late and I needed the truck back I agreed to do some research and come back to the shop later to figure out next steps.

The codes seemed to be pointing to the auto trans shift sensor / neutral safety switch sensor so I checked the wiring harness on that sensor and the other side leading to the ABS ECU. Truck also correctly started in Park and Neutral only. Packed up for the night with next step being to pull the neutral safety switch sensor out and test or replace.

However upon driving that night I noticed that when I depressed the brake pedal, the 'reverse' shift indicator lamp on the dash would illuminate. Not quite as bright as the drive lamp, but it was definitely lighting up... This led me to believe there might be an electrical problem with the rear light install.

Next day I pulled the taillight out and the interior rear quarter panel (with the built in storage space). I found that the replacement taillight came with a replacement wiring loom and the new ground wire wasn't quite snugged into the body via the bolt (i.e. by the body shop) I sanded down the area around the hole and replaced with a larger ground bolt. After that ABS lights went out and all have been well since. The best I can approximate what was happening was that when the rear brake light was energized, it would send voltage back into the 'reverse lamp' which then goes into the neutral safety switch sensor and then into the ABS ECU. The ABS ECU sensed an over-voltage condition which led to the code.

Takeaway for me is that C1207 can result from any incorrect voltage condition sensed the ABS system. That code might be accompanied by others if the voltage is flowing to/from a sensor or switch in the system it shouldn't be... so don't rule out bad ground or burned out lamps if the electrical drawings say they feed into the ABS ECU.