350 4×4 rear seal went bad for a long time undetected

I h ave always been on top of checking the fluids and doing the proper maintinece on my truck and other vehicles. I was a lube tech for 5 years tell I decided I needed a change. But I had never heard of this one tell it happened to me.

My rear seal went out in a 4×4 turbo 350 and ended up mixing fluids between the transmission and transfer case and went undetected tell one day I lost all gears except reverse. Can any one explain this to me and is there any were to go for a ifixit style rebuild of a turbo 350. Never done it before but the way ifixit has helped me learn to rebuild phones i know I could do a 350 with a tear down and rebuild. Or is the 350 just shot. Please help I inherited this truck and it's all I have left that was both my grandparents.