The major difference with the NP242 is that in 4WD Fulltime the transfer case is 'differentiated" meaning the outer front wheel can spin faster/slower than the rear without binding. With a 231 you'd feel the vehicle jerks/binds as it turns.
The 231 needs a surface where the tire can slip and not bind, like dirt/snow for example whereas the 242 does not. (in fulltime)