CHEVROLET 2002 BLAZER ZR2 POPS OUT OF 4 WHEEL DRIVE, MAKES LOUD 'KLUNK'

this is because its not fully shifting back into 2 Hi. make sure vehicle is in neutral and idling, push the 4 Low button listen for a shifting sound or whirring noise. then push 2 Hi button. it flashes while it is attempting to shift you should hear a shifting clunk or whirring noise, then the light will stay lit. after shifting from 2 wheel drive to 4 wheel drive shift into reverse before selecting drive on the column. the rpm going so high is because your vehicle is still in 4 wheel drive. the low gearing results in high rpm. if it does not shift into 2 wheel drive : there is a shift actuator on the transfer case, check the cable connected to it. this cable is connected to the vacuum control pump deal that controls you cruise control. this pump is located directly under the battery box. the plate the battery sits on must be removed in order to see it. check any wiring there and check for vacuum leaks in the lines connected to it . this pump actually pulls on the cable going to the shift actuator. check that the cable is attached and the baffle on the pump is moving. you can manually pull the cable by hand, while having an assistant operate the buttons inside the cab. this will release the actuator in the transfer case allowing the transfer case to shift properly. basically its a locking mechanism, locking the transfer case in the selected gear range. it must actuate in order to complete the shift

is the rubber boot cut or torn grease leaking around boot .if so then cv joint is bad and must be replaced

always drive in 2wd only use 4wd when traction could be a problem and 4wheel low when stuck or off road use

what sounds like is happening is the front end is not disengaging, it will not hurt it to drive without the module, but you need to find out why the front diff. actuator is not releasing. their is a shift motor on the transfer case, module and switch in the cab, and actuator on the front diff. all are susceptable to water, I would suggest getting a manual on it to aid in diagnostics

because when engaging low range on 4 wheel drive vehicle you should be standing still.

As I recall the 96 blazer had electronic shifting for 2wd to 4wd. There should be a small panel on the drivers dash buttons for 2wd, 4wd lo and 4wd hi.

Simply press the desired button while stationary and if the system is functioning properly then it will shift and the light for the engaged type of drive will be lighted. Generally you would like to be in 2wd for this vehicle.

sounds like the 4 wheel drive
switch in the transfer case is bad.

sounds like the shift motor on the transfer case is going bad.

have a trans shop check the linkages/sensor should be cheap unless linkage is damaged from 4wheelin
Good Luck

you could have a split vaccume line goin to the actuater switch that operats the 4 wheel drive under neath the battery box.