Grinding noise is Really Tire Slip
Any LR3 you drive on a steep enough grade with HDC engaged will make that noise that sounds like grinding. It's not! What is happening is that the HDC is engaging the anti-lock brakes for fractions of seconds, repeatedly and between the pulses, the tires will slide momentarily and that is the noise you are hearing. I've driven many and they all do that. All you have to do is get used to it. There is nothing wrong with your HDC. Take it on a long 30 to 35 degree grade with HDC engaged and you will feel the tires slip most every time the auto anti-lock brakes come on. Done it several times in my own LR3 and it works great. There is so much weight transfer and inertial force going up or down these severe grades, the tires will always slip (grind) momentarily when the braking system engages!
Hope this helps?