Question of semantics here... When you say "...it's engaged" you probably mean when the clutch pedal is pressed down. Being nit-picky here, that means the clutch itself is disengaged. If indeed that is what you mean, then the clutch (flywheel/pressure plate/driven plate) is probably OK (those are the expensive bits) and you just need a new clutch release bearing. This is probably a $35 part. However, to install it you have to remove the transmission, not a major task but not altogether trivial, specially on a 4WD vehicle. Figure about four hours labor for an experienced mechanic with proper tools (vehicle lift, transmission jack).

tanstaafl.