2002 1500 when you manually take the transfer case out of 4 wheel drive, is the front shaft suppose to turn freely

did you turn the locks on the wheels, or check the fuses

It should turn freely in 2 high

Someone will have to go under and check the linkage is working when the 4 wheel drive is fully engaged and not just moved to a neutral position.

The front drive shaft moves when the truck moves.. This is a "All wheel system" NOT a 4 Wheel Drive system.. Yes there is a clutch pack in the transfer case that is supposed to send the power to the wheels as needed. for traction. Make sure you keep all the U joints lubed and in good shape.. these are very expensive drive shafts. You really did not tell us the problem.. possibly the truck does not go ?. in which case it could be a bad transfer case or possibly a broke output shaft on the trans. except for the output shaft and rear housing these transmissions are the same as the 2 wheel drive models.post a comment and let us know what you find, By the way check to see if there is any fluid in the transfer case..

the shaft from the transfer case to the front differential should not turn free by hand because it is connected to the differential.

SOUNDS LIKE A BAD HUB TRY THIS TO DIAGNOSE THE PROBLEM

Put the transmission in park, set the parking brake and raise the chassis so one of the front wheels is off the ground while the other is still on the ground. When the transfer case is in two-wheel drive, the hubs should be released allowing the wheels to turn freely when spun by hand. If the axle shaft turns when you spin the wheel, it means the hub has not disengaged.
To check engagement, rotate the axle shaft backwards. This should lock the hub. Try turning the wheel by hand again. The axle shaft should now turn with the wheel if the hub is locked. If the hub fails to lock, the hub will have to be disassembled and inspected or replaced.
To check release, hold the axle shaft steady and rotate the wheel backwards. You should hear a click as the locking mechanism slides back out and disengages the hub. Rotate the wheel forward again and it should turn freely.
Another way to check the hubs is to raise the vehicle on a frame contact lift so all four wheels are off the ground. Then start the engine and place the transfer case in four-wheel drive and the transmission in drive. If the front wheels don't turn, look at the front axle shafts. If both shafts are turning, but one wheel is not, the problem is a bad hub on the wheel that isn't turning. If the front driveshafts are not turning when the transfer case is in four-wheel drive, the problem is inside the differential (broken side gears) or the transfer case (broken chain, shift linkage, etc.). If the driveshaft between the transfer case and differential is turning, the problem is in the differential. If the driveshaft is not turning, the vehicle is going to need repairs to the transfer case.
Hope this helps.

Drive Axle Joints or Wheel Bearings?

Try to lock the hub's manually ,on the front axel.
And yes this is normal

i'm assuming you have a 4 wheel drive. If that is the case then yes cause when your in two wheel drive mode the front is in neutral

The cv shafts will turn in 2wd but the front driveshaft should not. Can you jack up all 4 wheels to test this?