[B. W.]

In 4wd & with the hubs locked the truck should bind / scrub on pavement making tight turns.

Problem could be in front hubs or T-case

With the front hubs unlocked, in 4wd you should not be able to turn the front drive shaft by hand. If you can the t-case is not shifting into 4wd

You can jack the front end up, in 2wd spin the front tires by hand & confirm the hubs are locking & unlocking (you can watch the axle shaft/axle u-joint spin when locked). If one hub does not lock in it will act(feel) like a 2wd.

Check in "Hi Loc" (converted is 4 High), Hi = 2 high
should act / feel just like your 205 in 4wd