Boss,
If the jeep runs fine in 4x2, it can't be the rear diff that is a problem. The jeep is a rear wheel drive vehicle and if there was problem with the rear diff, then you would have the same condition in both 4x2 & 4x4 situations.
I think your front diff is jammed, and since that restricts the forwards motion of the vehicle, your moving rear diff makes all effort to push forward, creating that squeaking noise. DO NOT TRY OUT FURTHER, AS YOU ARE STRESSING OUT THE REAR DIFF.
Have your 4x4 gear engagement, shafts & front diff checked out THOROUGHLY.