It really depends on the map type. For SHUFFLE and Fractal where you could be looking at thin, snaky land masses, 4 tiles sometimes force you to waste perfectly good land when you happen to settle your capital 8 tiles away from a city state.
Or you could have a really nice spot but the 4-tile distance forces you out of range of some of the sea resources or forces you to settle on a good resource tile.
On maps with larger land masses, though, I don't feel constricted by the 4-tile minimum distance.
I think I've had something like that happen on a SHUFFLE map just yesterday, can't remember the exact situation, maybe it was actually a neighbouring civ. I just gave up the game because I didn't really like the general lack of landmass on that map anyway.