I thought the trac button was same as LSD button. But doesn't the 2wd also have a trac button?DVS is correct on post #15. The front differential has no mechanism for locking itself and thus sending equal speed to each wheel. From the ABS sensors it does know each wheel's speed. Auto LSD brakes the wheel that's spinning faster.
Traction control on 4WD does the same thing on the rear wheels also. So it has Auto-LSD on both ends. During my getting-stuck tests I've heard the heavy almost disconcerting thumping noises the ABS makes on whatever wheels are spinning. Then if the Skid Control ECU doesn't see the vehicle moving it essentially gives up and takes the throttle away from the driver. Turning TRAC off allows the driver to spin the wheels w/o traction until he either gets unstuck or breaks something.
What I don't know is does Auto-LSD also have the ability to reduce throttle when it sees no movement? And does turning it off allow spinning the tire with the least traction? I do know that when I got my FWD Accord "stuck" with both front tires on ice, both were slowly spinning with my foot to the floor. So it must have some sort of auto-LSD but I never heard any thumping.