IMO, it is obvious that the transfer case was not in NEUTRAL, or somehow got bumped into gear.
That is why I always towed my Jeep with the transmission in 5th or 6th gear. It kept the transmission from turning, but if the transfer case somehow got into gear the chance of catastrophic engine RPM was minimized.
When towing the Jeep I always put the transmission in gear and let the clutch out to make sure the vehicle did not try to move, thus verifying the transfer case is truly in neutral. I do the same with the Dodge 1500, except it is an automatic tranny. Once I verify that the transfer case is really in neutral, then the tranny can be put in gear (or in PARK, in the Dodge), and we are ready to go.
So sorry to hear of your disaster. So far, I have been lucky.
CM1, USN (RET)
2017 Jayco TT
Daily Driver: '14 Subaru Outback
1998 Dodge QC LWB, Cummins, 5 speed, 4X2
2 Kawasaki Brute Force 750 ATVs.
Pride Raptor 3 wheeled off-road capable mobility scooter
"When seconds count, help is only minutes away!"