Dear customer, I understand your query, as you will see this indicator 4x 4 on occasion. Although not all the time is like this, everything depends on the circumstances or the type of failure that occurs.
First, let me explain why when you disconnect the battery the indicator goes off what you are doing unconsciously is a restart of the system you are practically forcing the computer or download all the capacitors disconnecting the battery and in this way the vehicle is restarted. Obviously all the error codes are erased and simply until the computer does not return to receive the error, the error code does not turn on again because this last a while working in this way.
Now dear customer, this does not mean that the problem presented is purely electrical, on the contrary you may be presenting a mechanical problem easily, this is why there may be various factors that cause this inconvenience, given this I want to make the following recommendations .
Dear customer always the best way to proceed is to perform a computerized diagnosis in this way you will have access to the precise error code that is causing this failure, but this diagnosis can not be made by a generic obd2 diagnostic equipment, this type of diagnostics must be made of a diagnostic equipment that owns the software for your Volkswaguen, the equipment used to perform these diagnostics is known as VAGCOM are very good equipment used in several garages and have access to all vehicle systems including traction and transmission.
Now dear customer, regarding the possible faults or the possible causes of this inconvenience in fact the list is a bit long, but how this inconvenience occurred can be simply left to the ground through which you passed could have entered dirt or moisture to the connectors of the system 4x4, and this is why the failure occurred because this humidity can damage considerably the connections of this system. But do not worry, very probably doing a good maintenance this problem will be solved.
It may also be that one of the components was hit causing the transfer or differential to slip out of place. Therefore the computer recognizes this and turns on the indicator by disabling traction according to the case.
Do you understand what i told you dear customer?