I have been wrenching on a basket case 2001 cherokee 2wd. When I got it the previous owner had started taking it apart. No big deal because I am very familiar with 4.0 engines. But I noticed a plug hanging down towards the rear of the transmission and I cannot find were it goes! I think it may be for the transfer case if it were a 4x4. Not sure, here are a couple pics. Thanks for any help.

 

i'm thinking you are correct