I have had instance of seeing the 4LO indicator.
I recently changed struts in the 4runner, and took it out and went into 4wd normally. By that, I mean it was from a slow forward roll in drive. So, no problems.
Several months later, snow is forecast and I took the runner out, put it in 4wd, and suddenly, I am getting the steering jerk and grinding. I stop and try to go in reverse and mess with the steering and it finally comes out of that 'state'. I was happy to get back into 2wd and out of the flashing dash indicator trying to get 4wd.
I have learned now that if I put the runner in 4Wd, and I roll backwards (sloped driveway), and engage reverse, I get 4wd in and out no problem.
I do not think I have ever put it in 4wLO since buying it. But I recently had seen the indicator when getting in after using 4wd. I put the runner in 2wd and the indicator (4wLO) went out.
Very strange. I have over 160K on it and it is really reliable. I will put it in 4wd once a month now and wonder if I should do a complete change of all fluids.
Edit: by the way, no codes. I am very familiar with the VSC issue and have written about it here. If someone wants to search my posts, and can't solve it, I can run them through the solution. It really should be a class-action lawsuit, IMO.