Seeing as you can move it in park I would discount oil pump failure. Follow Blknight's advice and start by looking in the transfer case.
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Check that the drive plate/flywheel (the part that the torque convertor bolts to hasnt come apart), Regards Frank.
Mine did a spline in the torque converter a few years back. Same symptoms as yours. Cost about $280 from memory to have it reconditioned. The real hassle is pulling the transmission to replace it. The $4k quoted would be to reco the lot. It depends on what condition the transmission itself is in.
How many ks?
Tony