I downloaded lightroom 4.0 and its still saying no camera detected..
This might be tough to solve. I used to have a Rebel XT and there was a tethering problem a few years ago, I think the issue was that Lightroom was using the Canon SDK to achieve tethering, but when Canon updated the SDK for newer versions of Mac OS X, Canon dropped support for the Rebel XT. So any programs like Lightroom that were relying on the Canon SDK lost support for the XT if you upgraded your Mac system. I'm not sure of all those details, but the bottom line is that there might not be software around that can still tether a Rebel XT on the last few major versions of OS X/macOS. From what I'm reading, you might not be able to tether a Rebel XT if the Mac is running OS X 10.6 or later.
The old program DSLR Remote Pro could tether a Rebel XT only up to OS X 10.5.
The current version of Capture One marks tethered support for the Rebel XT as "No."
Your best chance is to go to the page for the Rebel XT on the Canon web site and see if you can find the latest version of EOS Utility that supports the Rebel XT. While this won't fix Lightroom, you can use EOS Utility for tethered shooting (in theory), and if you set it up so that EOS Utility dumps images into a Lightroom watched folder, Lightroom will import and display them as you shoot. But I think the problem here is that the current version (EOS Utility 3) does not support the XT, and the version that does probably doesn't run on OS X 10.11 El Capitan. But you should take a look around there in case I missed something.
The only other suggestion I have is to check the communication setting on the XT. I think it's supposed to be set to PC Connection for tethering.
Were you tethering successfully before? If you were, what version of OS X was the Mac using at that time?