The 4 GB is your RAM, not your disk space. Lion only requires 2 GB of RAM, so you're good there.
The 7 GB recommendation is for free hard drive space -- odds are you have that much available unless you've filled the whole hard drive. Open up Finder and do a "Get Info" on your hard drive under "Devices" -- that will tell you how much hard drive space you have available.
LOL Maybe I have an IMac from Mars. There is no Get Info on Devices of Finder.
Here is what I found at bottom
Macintosh HD 484.69 GB available
I Disk 10.73GB available