Having our trucks in 4Hi is essentially AWD because of the center diff. It can be driven on dry pavement in that setting (remember, a center diff., front and rear drive shafts are able to spin at different speeds... as in: during turns and curves). Locking the center diff. turns our trucks into a traditional 4x4 with just a transfer case (such as found on fords, chevys, or even tacomas, etc.). This setting will generate driveline binding if used on dry pavement.
Natter, if you are having traction issues on hills, there's no reason why you can't lock the center diff. However, if you still slip a lot in that setting, you don't really have any other help. If you try with the center unlocked (low gear, feathering your throttle, or even 4Lo), and you have trouble, locking the center gives you a "greater traction" option. Like others said, appropriate tires is a factor. And also, if you're slipping in 4WD and locked at the center, you'd probably be slipping with the center unlocked... in which case you should have picked a different route and you'll never get home now and it's time to go native...
Something else: remember the traction control is bypassed with the center locked. Like RonJR said, it's a judgement call based on conditions. I've found that 4Runner's traction control works VERY well. Every winter, when we get the weather for it, I go out to a school parking lot after hours, or somewhere else specific, to practice (and have a little fun) and see what the truck will do and what I can make it do. It's tough to get it to slip and slide with the traction control on.
I need to get my wife out with me to let her feel what slides feel like and what to do and what not to do. She's really nervous about that stuff. Better to have an idea of what's going on then not realize until its happening with traffic around.