'98 suburban transfer case

I was getting noise when I would hit dips and bumps in the road like something was rubbing. This winter when I put it in 4-wheel drive it was really loud all the time. We finally took in into the shop and they said I needed a new transfer case and the fluid was really low and pieces floating around. They didn't open it up. Just did a quick check. Now when we drive even in 2 wheel drive it is starting to get really loud.
I have the auto 4-wheel drive version (NP8 code) and they said that is the most expensive one ($1298). Does anyone have an opinio on what I should (how much I could get a sued one for). I only have 75,000 miles on it.
Are they hard to change. The shop gives 3.3 hours.
Any help would be appreciated.

Should I fill it with fluid and see what happens.
Thanks for any help

If you have chunks of metal suspended in the fluid, it's too late for more fluid to fix it. It probably wouldn't hurt to add more fluid, but it's not going to solve the problem. The fix depends on how mechanically inclined you are. I would replace it myself with a manual range selection T-case, and add the buttons on the dash. I don't think switching in and out of 4x4 is very good on the transfer case, and that's what the auto-4x4 systems do every time you go over just a small amount of sand, water, snow, etc.

Does anyone know where I can find instructions online to swap out the Transfer case. I when to chilton DIY.com and they want $19.99. I Have the book but it does not have the instructions for this transfer case (auto 4-WD). Also where is the best place to find a used or rebuilt transfer case. The best price I can find locally is $1300 (rebuilt)

go to a Junk Yard for the t case. Even Try it on ebay. Go to an autoparts place and get a book on your truck. it will be the best 20 bucks you spend. believe me. they will walk you through it. wont be too hard as long as you can get the car at least 2.5 or so feet off the ground.

I have a book but it doesn't cover my transfer case. Checked junk yards within 300 miles. They have tons of transfer case, just not the one they made for the 98 suburban/tahoe. None on e-bay either

$1300 is resonable