Cutting 4" square should be enough but it depends on how you sew
and what type of thread you use. If the thread is thick it will take
more space in the seam allowance. If you sew right on the line
or next to the line it makes a difference. The only way to find out
is to press and trim. If you find you can't trim to 3.5" square
then cut the square bigger or adjust your seam allowance a little.
You are right on track for the 4 patch. That's the way I know to
make quick 4 patches. If you have lots of 4 patches to make
in the same fabric, you just cut two long strips, sew then sub-cut.