I wouldn't co-mingle PHP4 and PHP5 on the same server whether it is for development or production environments. At some point, you have to make a commitment for the future. I would rather play it safe and not monkey around with what just works.
Thus, find another box and put PHP5 on it. This way there is no question whatsoever what is running on what version and what box.
Consider the delimna server hosting companies have. Here they have a lot of customers running PHP4 applications. These applications come from commercial and open source. I would think that it would be unwise to take the risk of trying to forcefully transition existing customers with PHP4 applications onto the same server with PHP5 installed. To pull the rug out of you and replace their PHP4 base with PHP5 and putting the responsibility back on the website owners is a sure fire way to lose customers. Not all website owners know how to program in PHP. Not all applications will "just work".
The lowest risk is to have separate servers - PHP4 and PHP5 servers. If you don't have money to afford another box, then go find a PHP5 hosting company and pay a few bucks a month.