This is ridiculous on a lot of levels. The thing that kind of got me was "being more concerned about his hair than his education" when your dealing with a 4 year old. His education probably consists of "don't eat the paste". At that age it's more like day care than education.
As far as the hair issue goes, I can see the why this might be an issue, even if it's slightly ridiculous. The first thing that comes to mind is that the lady in question probably signed paperwork saying the kid would fit X standards. At that age he's not making his own desicians so the parents pretty much decide on things like hair length and when to get it cut and so on.
The big issue is of course that if the kid has long hair it has a tendency to get dirty and caught in things (dragged through paste, etc...). It's more difficult to keep the kid sanitary if he doesn't fit certain standards which are agreed to to make it easier. Not to mention the fact that kids do have tantrums and rough and tumble/fight at four, especially boys, and long hair means that it's liable to be pulled/pulled out. Then of course you have to wonder what kind of activities they do, for example if the school in question brings the kids out for supervised walks in the woods or whatever, again having long hair means it being caught in things, and getting stuff stuck in it. Keep in mind this is a four year old, so if he's got long hair he's not treating it quite like an adult. If he's got it down his back or whatever that can be an issue.
I do know that some day cares and such require girls to have their hair tied into braids or pigtails for similar reasons (easier to keep up and out of the way) and I think it's even started to become part of school dress codes up to Jr. High in certain places.
Laugh if you want but I'm looking at the situation from both perspectives. On one hand it sounds ridiculous because it smacks of people screaming at kids for being rebels. But by the same token if I'm responsible for watching a gaggle of four year olds by myself or with maybe or or two others, I want to job to be as easy as possible. Given the liability I can suffer if something happens I want as few variables as possible, and things like dress codes, hair length, etc... simply makes my job easier. At that age the kid with long hair can get into that tiny bit more trouble by having long hair.
Years ago it probably wasn't as big a deal I'd imagine, but times HAVE changed and with all the day care places that have gotten in trouble, I'd imagine everyone is concerned about covering their backs as much as possible.