First, you use FDISK to install a partition on it. I presume you want
all 4GB to be in a single partition. So when FDISK starts, answer
"yes" when it asks about large disk support. That will cause it to
crate FAT32 partitions, and you'll need that because FAT16 supports no
partitions larger than 2.1GB.

Once you've created a partition, just reboot. You should now see a
letter assigned to the new partition. Either open a DOS box and type
format x: (where "x" is the letter of the new partition) or find it in
Windows Explorer or My Computer and right-click it and choose
"format". Now your new partition is ready for use.