Specifically for the LC100 the early generation manuals came with
H2 : Regular everyday driving with power only going to the rear wheels
H4 : 4wd mode the front and rear diffs are locked to each other, think of it as only one drive shaft running from the front to the back, if the front turns the rear also has to turn, since most didn't come in the fulltime 4wd version, they lacked a center diff. You shouldn't be driving on tarmac or paved surfaces with this engaged as front wheels speed will differ with the rear wheel, specially during turns you will put undue stress on the drive train, tyres will squeel at low speed turns and steering will be very heavy. And evenutally end up snapping an axel shaft or crunching the diff with prolonged use.
L4 : Same as above but in low ratio.
Automatic LCs and later on H2 was removed from the lever and a button on the dash was given, which would electronically engage 4wd once pressed. I know this because I had one and have tried it, you could put in Low Range without pressing the 4wd button and you would have low range Rwd vehicle!
Many cars and even some LCs come with a center diff some lockable and some not, which allows it to be a fulltime 4wd and you can drive on roads at any speed, for example Land Rovers ( Defenders, Discoverys, Range Rovers etc etc ) Only come in fulltime 4wd, you cannot switch to 2wd mode.