I'm not familiar with that platform, my Yota stuff is pre-Taco, so I'm spitballing.
Do you have a front axle disconnect? Sometimes those require backing up a goodly bit, or rocking back and forth to get them to unbind and retract. A previous Chevy I had would leave the light on until you backed up enough to disconnect things. Other times the vacuum lines leading to the disconnect can have issues and no longer retract or engage 4wd. I got sick of the axle disconnect on mine, installed manual hubs, locked the disconnect in "connected" mode, and removed all the vacuum BS.
Not sure what triggers the light, your actuator and 4wd stuff might be fine, just a problem with the indicator. Could be as simple as spilling coffee on your center console and the micro switch that turns on the light in the dash being gummy now. No clue if that's what actually turns on the light in the dash on yours, like I said, I'm spitballing.
My current Prado is full time 4wd with a center differential in the transfer case. 4 wheel high, 4 wheel high locked center diff, 4 wheel low locked center diff, no 2wd option. If I ever go into the transfer case, it's getting manual hubs and a transfer case with 2wd.