I have the H2 (it's about 2 years old now - don't know if they've updated it) and love it for capturing my band since the four mics allow for 360 degree recording for practice sessions. Recording live shows I usually only use the XY pattern and stick it out in front of the band wherever it won't get trampled or spilled upon :). I don't have experience with the H4, so I can't compare the quality, but in my opinion the H2 sound quality is more than sufficient for getting bootlegs for the band to listen to, or to make sketches with. I do find that I have to master it a bit in the live case so that everything is EQd better, but it does a pretty good job on its own.
The interface sucks, but I don't ever use anything except record and delete, preferring just to use my DAW for effects, etc. Oh, and one other issue with my version is that it's USB 1.1 so it's pointless to try to copy to my computer over USB (I just pull the SD card out). Otherwise it's a great little tool for sketches.
I wouldn't use it for any serious recording, though to be fair I don't think any hand held would be up to the task.