Yes it can and does. It depends on the corner geometry and speed as to whether it spins up the front inside or rear inside.
Given that it switches between front inside and rear inside, it's kind of obvious that trying to put all the drive (2x as much as 4wd) through the back wheels in those situations ain't going to help.
You're not going to make it more reliable by sending 2x as much drive through a standard rear axle with oversize tyres.
If you've spent some big $$ upgrading that 110 rear axle you might.
Fulltime 4wd puts half as much torque through each axle compared to 2wd.
Some light reading on the LT230 upgrades for big power here:
I blew up my LT 230 at KOH and it took me out. - Pirate4x4.Com : 4x4 and Off-Road Forum
I don't have a 2" lift in my 3. I'm special apparently. But since emergency maneuvres have saved my bacon at least twice on road I'm happy with that.
A lift steepens the angles of your suspension links, making for more antisquat in the rear and more antilift in the front. This reduces traction on the front wheels under power.
It also raises your COG and causes more weight transfer under acceleration, braking and cornering. Which makes your problem of picking up tyres much more frequent.
Sorry this must be a difference in lingo between AU and NZ. Here a "wheelie" isn't a burnout. It's picking up the front wheels under power. I'm not sure what Aussies call it.