There are AWDs and there are AWDs.

You seem confused about what "AWD" actually means: it means full-time four-wheel drive, period.

Whether an AWD system is suitable for off-roading or not depends on other aspects that the term itself does not specify: 1) whether there is a low gear, 2) whether there are lockable differentials and 3) what vehicle chassis the system is mounted on.

Most of the high-end off-road vehicles have AWD with low gear and lockable differentials. Examples are Hummer H1, Range Rover with off-road package (adds lockable differential) and MB G-class (all 3 differentials are lockable!). Here I use "AWD" as it is meant to be used: these are all full-time systems.

The "manual" systems you mentioned are normally in 2-wheel drive mode, which is pretty crude.