I am not sure, if there were Actions available in Photoshop 4 but if so, you could create an action for saving the image with level 4 and use this action for saving.
I'm not sure, documentation for version 4 is long gone. Maybe the help file?
Anyhow, I just thought of another possibility...
Because of the instability of the virtual machine under Windows 7, I took to pre-processing the images with Photoshop 7 and saving them. I would launch the virtual machine, launch Photoshop 4, if it would work and not crash, then make my thumbnail images and do canvas size to give a 10 pixel white space on the right side and bottom of the images. Then another add-on, (I don't remember it now, maybe something like "alien ware"), to create a drop shadow. Then save the image, (reset them for saving at that point to 4 & 5 level), then drop the images on the E: drive of Windows 7 for my master web files for later incorporating into pages and uploading.
Do you think there a possibility that the operations of Photoshop 7 in resizing and saving, (at a level 6), is predetermining the default save level with Photoshop 4?
In photoshop 7 your saving the files as jpegs or....?
And your using File>Save As or File>Save for Web in photoshop 7?
Is photoshop 7 installed on your windows 7 machine?
If so, photoshop 7 can do drop shadows using Layer Styles and File>Save for Web can save your files probably in a smaller file size than ps 4 can.
As far as virtual machines, VMware or VirtualBox seems to run a lot better and is more stable than the windows xp virtual machine one can get for windows 7 and either one is free for personal use, but the one caveat is one needs to have an operating system to install on it, like a windows 98 or win 2000 install cd or iso.
How to update win 2000.
Just install the updates from the list up to Cumulative Security Update for Internet Explorer 6
for the most stable install, The other updates are for running more modern software like web browsers
which one really doesn't need if your only using win 2000 as a virtual machine.