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Flashing means that it did not engauge, you may have to put it in 4 LO and let the truck roll a little to get it to engauge, same with the locking rear diff. These lock via electric motor and you may need to move to get it to mesh.
The blinking is telling you there is a problem in the system. There isn't much to the system, so if you can get the codes out of if then report back and we can lead you in the right direction.
We'll need the code, Otherwise you'll just be throughing expecive parts at your truck.
I had that problem in my 1998 Blazer. There is a module on the passenger side of the truck, next to where the passenger right foot be. Remove the side kick panel to get to module. Disconnect battery before unpluging and pluging new mudule in. This unit controls the electronic switching between 2 and 4 wheel drive..Wes
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