Yes, you will still have AWD, as it is mechanical in nature. An electrical failure doesn't eliminate the driveshaft to the front axle. What an electrical failure does do is compromise the DSC system, meaning you won't have the same degree of control and stability in poor conditions.
Get it to a dealer, get the codes read, and then you will know exactly which sensor or module isn't functioning.
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2007 X3 3.0si, 6 MT, Premium, White
Retired:
2008 535i, 6 MT, M Sport, Premium, Space Grey
2003 X5 3.0 Steptronic, Premium, Titanium Silver
2002 325xi 5 MT, Steel Grey
2004 Z4 3.0 Premium, Sport, SMG, Maldives Blue
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