I'm not well-versed on the mechanics... but spinning wheels at different speeds from a perspective outside the control of the AWD system is very bad for components such as the diffs.
Otherwise, if you tow with the handbrake up, that's obviously really bad for the brake shoes.
Or, if you tow a FWD cars on its front wheels and in gear, well, very bad. The wheels will drive the engine, probably well over redline, since most who park in gear use high ratioed gears such as first or reverse.
RWD cars on the rear wheels, same thing.
If you tow an auto in park, well, you'll probably snap the parking pin. Tow it on the drive wheels in neutral, the tranny fluid will not circulate and cool properly without the engine running if we're talking about a slushie.
As far as a manual, you just don't want to tow it on the drive wheels, even if its in neutral.
Regardless, the best way for any car is flat bed.
However, with that said, I often find that 99% of tow drivers I've seen are completely stupid. I just see them drive up, and yank cars away, with their FRONT WHEELS ON THE GROUND (FWD cars), going backwards... are they stupid?
Well, they don't care since all they care about is ripping you off when you come to the tow yard, don't know your rights (sadly, I must say that even I don't when it comes to towing), and they're able to charge you hundreds of dollars, and then say "we're not responsible for damage."
Ugh. I can't say I've really had good experiences with more than maybe 1-2 tow truck drivers. The rest were complete jerks... and ignorant to boot. A good tow driver is very hard to come by.
And before you all make assumptions about me... no, I haven't had my car towed. No, I don't park illegally, etc etc.
