Why you'd want to run in runlevel 4, I dunno. That's not used in Red Hat 7.2.
To start your system in a particular runlevel, do "linux n" at the LILO prompt, where "linux" is the name of your thing to boot, and n is the runlevel you want to start it.
To be honest, I think you'd be better off starting up in runlevel 3.
This from /etc/inittab on my Red Hat 7.2 system:
# Default runlevel. The runlevels used by RHS are:
# 0 - halt (Do NOT set initdefault to this)
# 1 - Single user mode
# 2 - Multiuser, without NFS (The same as 3, if you do not have networking)
# 3 - Full multiuser mode
# 4 - unused
# 5 - X11
# 6 - reboot (Do NOT set initdefault to this)
It should be pointed out that 3 and 5 are the usual runlevels to use for multiuser with networking. 3 is console mode, 5 is X11 login.