According to the posters on this thread, the only changes between 1st and 2nd edition were cosmetic.
Although one poster mentions slightly different wording on some of the wands.
The differences between 2nd edition and 4th edition are noted on this thread.
Cosmetic changes, including larger board, cards, plastic bits, and cardboard cutout characters.
RULES and GAME Mechanics
6) Major Difference - Craft can be gained for every 7 points of craft monsters defeated.
7) Major Difference - Spell Casting Limitations - In their turn, the maximum number of Spells a character may cast is equal to the number of spells, and whichever spells they possessed at the start of that Turn. A Character may only cast one Spell during another Character's Turn. This does not apply to the Command Spell. (If you ALWAYS have a Spell due to the Wand or Ability, you draw your 'new' spell at the end of your turn)
8) Major Difference - Mules are NO LONGER OBJECTS, they are considered 'FOLLOWERS' "The mule can carry an extra 4 objects for you while it is your follower. If you lose the mule, you will leave any surplus objects of your choice in the space you are in." I.E Mules can be 'Mesmerised' by the spell but NOT 'Acquisitioned' by the spell, hence if you win a character to character battle, you can no longer 'take' the mule, as its no longer an object.
Visiting the Villiage shops is not optional, Market Day allows everyone to buy from a market rather than trade with each other, Orb of Knowledge is no longer one use.