As quoted on the VC section of Ashcrofts website:
A common problem with the Range Rover BW transfer case is a "seized viscous coupling". This can easily be identified by the effect it has on cornering, the tyres will "chirp" or "scrub", as the vehicle is effectively permanently in diff lock. As a confirming check, put transfer case in "neutral", handbrake on, jack up one front wheel and try to turn it, it should turn slowly with resistance, if locked solid the viscous coupling is seized, and will need changing before any damage to the diffs or CV joints occur.
I've used this method to check VCs on a few RRs and it is the test that had has always worked.
Note they say transfer case in neutral and handbrake on....