Whenever a vendor used that term to describe their product, you knew you were in for a long process of trying to determine what the product really did. The point is, the term meant nothing because it meant so many things. Many vendors are using this term to categorize their products, the press talks about it with sage wisdom, the analysts compare the merits of various Layer 4 switches. Just as with 'Switching Hub' - the term does not mean anything .
Marketers use the term to describe a wide range of functions and services.
In almost all the cases, while the function is not truly Layer 4 switching, it's potentially useful nonetheless. So that's not the issue. The issue is one of vocabulary. I would like to propose my own set of terms for these functions. Let me know if you find my terminology easier to deal with.