G'day Ian,

short answer to your questions : cheap- no , neat- no , works well - yes.

basically the entire engage /disengage of power supply to the rear wheels is
contained in the rear differential.
the universal at the end of the rear drive shaft connects to a clutch pack
inside the diff .
(using dynamic oil pressure) the clutch is controlled by rotation speed
comparison of the drive axles +  drive shaft.

as an experiment in 1998 sometime , I machined 2 "taps" into the clutch
packs in the rear diff housing and using a flexible high pressure hydraulic
line with a return/stop/return valve in the cabin next to the handbrake ,
was able to lock in the rear diff whenever needed.

worked faultlessly on loose dirt, sand, mud, grass, etc etc
seemed to work fine on dry/wet seal surfaces , but i was too chicken to
thrash it hard and test it to destruction.
the clutch discs never seemed to heat up as i expected ,
I assume that normally there is a lot of slipping and friction when they
work ,
but since the valve switching was always fully "ON" or "OFF"  there was
presumably no significant heating of the diff oil.

A friend that now works for honda in NZ says that when he visited the Honda
Plant in Japan last year they had adopted an almost identical engineering
model that was being bench tested for the next series of CRV.

If you are keen , I suggest you find a scrunched up HRV in a wrecker yard
somewhere and pinch the rear diff , take it apart and do the mods in your
garage then fit it , that way you will still have transport and a spare diff
if the tricked up one self destructs.....

good luck.

Dash

(ps)
i agree with you about the vehicle being quite a nice drive , i grew quite
fond of it over the last few months.