ARB piston failure
In the spirit of contributing to the communal knowledge bank:
My ARB stopped disengaging at some point in las cruces (surely it had nothing to do with operator error)... and I just recently got it all apart. Turns out the plastic piston that makes the whole deal work was chewed up on the ring gear side. Little pieces of the piston were still wedged into the clutch gear when I took it apart.
Not sure exactly how this happened. Guessing I tried to turn it off while doing something stupid. But parts direct from ARB USA were only $42 (including bolts, retaining clips and o-rings).