Locking the CAD DOES NOT lock it in 4wd. It still leaves you with disconnecting the front axle at the T-case.
Hopefully these will help:
This is what it is now, in 2wd. T-case and CAD both disengaged. Only the rear is powered.
This is what happens when you pull the lever to 4wd, and the CAD fails on you. T-case engages, but because the CAD isn't engaged, the front wheels are not powered. Only the rear is powered.
This is how it would be with the CAD locked permanently, or with the CAD gone, as they did anyway, with phasing out the CAD. The T-case is still in 2wd mode, so there's no stress on the drivetrain. Only the rear is powered.
This is what it's like with the CAD engaged and the T-case in 4wd. This is the only way to get 4wd.