Hi Anurag.You can, and I explained why in my opinion not quite explained in the product documentation.
The wiring is realized as you say, I've tried 2 or 3 wire with good performance (without using the gnd or with him).
What you should consider is to put the terminating resistors (typical of 100 or 120 ohms) at both ends, if for Modbus equipment or wiring topology did imperative. It is usually recommended in any case to mitigate the noise.
The port can be used for two or four wires, but the problem is that it leaves from the MAX set because they are hidden parameters (at least in the version I frame the Lw2012sp1).
By default the start sbRIO four-wire, so you should change it from an IV (parameter "modewire" I put an example with a screenshot).
If you have the DSC module, you have very easy to set variables in a modbus master cyclic program, but limited to 1 second in the read cycle.
Roberto
