I understand that 1.4 is going to take a long time before its release, as Chucklefish is working on other projects that are probably higher priority. I stopped playing Starbound for a while after the 1.3 update, and I was recently hoping to get back into it. My question is - will the 1.4 update be so huge so that it would delete all my progress like most updates leading up to 1.0 did? And if it doesn't, then will the changes be so significant that it would be more worth it to wait until the update comes out to start playing again?
It shouldn't delete progress. They have actively avoided that once the game was officially released. They would only mandate a reset if there was no other way, but this is unlikely to ever be the case. As for when you should play, that is entirely up to you. I doubt it will matter much in the long term.