From SFE's EagleCAD library, I'm trying to use the 4-pin 1.27mm through hole part (1x04-1.27mm). But, BatchPCB kicks it back to me with a spacing error. So, can we not use that element then? If so, why bother including it in the library?
Because not everybody uses BatchPCB to make their boards. While BatchPCB and Sparkfun both make use of Goldphoenix, BatchPCB requires larger tolerances to keep the prices low for 1 piece orders. When Sparkfun orders production quantities from Goldphoenix, they are allowed tighter tolerances because the price is spread over a much larger order.