old school subarus had a low range and a real transfer case, before they went AWD.
Not sure about now, but the MT subarus from the 90s to early 2000's actually did have a limited slip center diff, so there was power sent to both ends with limited slip in the middle. the ATs back then were basically FWD with limited slip rear (the clutch was both a viscous unit + electro-mechanical modulations), with an aggressive bias to keep the rear powered. As they aged, the AT version was aggressive enough that it was not uncommon to hear complaints of chattering in turns.
Having owned both subaru and "real" 4wd vehicles, I think the subaru makes a more elegant snow machine. the center-diff-based AWD is well-suited in traffic, especially city turns or sweeping corners. a true 4wd does just fine, but true 4wd will force at least one tire to spin in every turn, sometimes causing the driver to "drive the car" a little more directly. If it were my wife, I'd want her in AWD. Now, if you romp on the 'ru, it will do exactly what a locked 4wd will do, because the limited slip center diff really doesn't allow much variation at all between axles. at least, that was the case in my '97. It could be a holy terror (gobs of fun) with 2nd gear clutch drops half way through a turn. The low CG also made it so nimble for well-controlled 4W drifts in each and every corner or turn. umm, that's what I've heard anyway.
I am glad to read that some folks like the electronic limited slip differentials (ELSD) out there. I myself have had near-pathetic experience with some of them. 2wd jeep WK had the ELSD and it was useless. It would not apply enough brake force to move the other wheel. I'm talking anything from me gently coercing the vehicle to move, to me getting out while it was idling in D, looking at that wheel spin on its own, listening to the ABS system pulse the spinning wheel, seeing the wheel pulse, and still not send enough to a) stop that wheel b) move the vehicle. it was ridiculous. In our minivan, it's a different story. It will equal out a 3/4-throttle burn out on dry pavement. I'll give credit to the jeep's ESP---- I never triggered it accidentally, but when I'd trigger it, it was like "Hand of God" and the car would immediately stabilize. Unfortunately, it would also stabilize with all throttle cut... so if you needed to keep moving out of a situation, sorry, you were plumb zero mph wherever it left you.
There ARE drawbacks to mechanical LSDs, which nobody has mentioned. In the slick stuff, if one wheel breaks loose, the spin gets sent to the other side, which will also break loose as well. So if you aren't driving for the conditions, a mechanical LSD will easily break the whole end loose causing immediate oversteer. While I personally prefer a mechanical because it's more robust, if it were my wife (or kids) driving, I'd suggest not going with a mechanical LSD. They need to understand and have good butt-physics-understanding.