Its interesting that your "mechanic" thinks full time 4WD will destroy the transfer case on a truck that is already 38 years old. Somehow I think it would have already happened by now if it was a real problem.
I have a '75 K25 with 350/TH350/NP203, and it was one of the most common transfer cases for GM, Ford and Dodge during the 70's. Many were converted to part-time 4WD with a milemarker kit, but I would not recommend making that change. It works fine overall, but you must be very careful to periodically run it in 4WD (about once a week) because in the 2WD position it does not properly circulate oil in the T-case. Very few folks understand that, and many of them have ignore the maintenance and have significant problems after being converted to part time.
An unconverted NP203 may get a little noisy if the chain stretches, and the shifter linkage can get out of adjustment, but there are no major issues with them.
Bruce