I have all 4 installed and am currently playing the game now, like all multidisc games due to draconian copy protection they still have to be swapped when playing the game but apart from that the hdd gets used.
Basically insert disc 1, press the button to load the info (not the game) choose install, swap to disc 2 and repeat, repeat process for 3 and 4.
If you use the memory disc to watch the cutscenes that still requires disc swapping as well very annoying. So installing to hdd doesnt remove the requirement to swap discs. But does reduce noise during gameplay and decrease loading times.