Can anybody explain why the S4 (manual) has 3 overdrives and 4.11 final drive instead of...
 

just a taller final drive with 1 or 2 overdrives?

my only guesses...
 

...cheaper to change final drive then cut new gears/sliders/etc.

Also, they likely wanted to have the car geared to hit 60 as quickly as it can without needing a second shift (so redline 2nd gear). Going with the above assumption, they probably took whatever gears they were using, then made a final drive specific to get them where they needed to be.

This seems logical as the RS4 got shorter gears (not a mass car, so they could change what made sense to change to make a better car). Ever notice that 1 and 2 and final are the same, but the taller gears are shortened up in teh RS4?

This makes sense to me, the S4 box is "ok". The high 4.11 final is nice (IMO), I'd like shorter 3/4/5. I'm not racing, so the tall 6th is fine for me for the long hauls.

4th is 1:1 in most rwd trannys. The input and output shaft are simply locked together in 4th.
 

My guess is that this was not possible in our trannys because of the AWD layout so 4th gear got the ratio of the engineer's choosing.