The major goal of this, is to dismantle the city, isn't it ?
Actually, you can abandon the city in Civ3, fater selling all improvements. However, you do not recuper the population. Of course you can create settlers or workers, but there will still be 1 that you can't get back. Two things can happen in Civ4.
First, not change. You live with it and make that city producing workers fastly enough, all the time.
Secondly, there is an new option : Dismantling the city. This option would make the gouvernor sell every improvements (not the units), turn by turn. When finished, it would transform the population into settlers and/or workers. If you are within 3 turns away from an extra population point, you can choose to wait until it happens. When done or is over those 3 turns (or more if you want), the gouvernor ask you what combination you want. For example, a size 5 city, will give you those combinations :
5 workers
3 workers and 1 settler
1 worker and 2 settlers
After that, you do what you want with your new settlers and/or workers. This option shouldn't be possible for the cities you have built, with the exception of the ones that are not placed on the same continent or island that your capital and the ones (if not on the same ...) with the Forbidden Palace and Secret Palace (with Communism in Conquest).
That means that you can do it with the conquered cities. But do keep in mind that selling the improvements might make the city switch. With those cities, there is a little problem : unhappy citizens. If their civ is totaly destroyed, they'll make normal workers as they are deffinitively part of your civ (unless they switch to another one). If their civ is still alive, the happy and satisfied citizens can be transformed into workers or settlers. The unhappy ones can only be transformed into workers. If the number of unhappy citizens is higher than the happy and satisfied (city in disorder), those will be transformed into slaves and the orthers into workers only.
Example 1 : you have a conquered city, size 8, no disorder (4/1/3), 3 buildings and 4 turns away to improvement. The gouvernor will sell the buildings during the first 3 turns. Then, he will ask you is you want to wait 1 turn to reach size 9. You say Yes. Next turn, there is disorder (3/1/5). You can transform them into 4 workers and 5 slaves.
Example 2 : you have a conquered city, size 6, no disorder (4/1/1), 1 building and 8 turns away to improvement. The gouvernor will sell the building next turn. Next turn, there is still no disorder (3/2/1). You can transform them into 6 workers or 4 workers and 1 settler, 2 workers and 2 settlers. As one citizen is unhappy, it cannot take part in the transformation into a settler, which leaves you to 5 possible.
Maybe this one is too complicated, but it can be nice to do so. When you have a city which isn't where you wanted to do or had done if you could, it is nice to recuper anything that you can. And having more than 1 settler (if possible) can be nice too.