Determining if the mouse is on top of a box
I don't see a convenient way to do a for loop, but you could extract common functionality into a single function:

bool CheckAndModify(PictureBox pb)
{
    if (displayCollision(drop, pb) &amp;&amp; (display != pb))
    {
        display.Location = pb.Location;
        display.Size = pb.Size;
        pb.Location = defaultLocation;
        pb.Size = defaultSize;
        return true;
    }
    return false;
}


And then:

bool modified = CheckAndModify(pbDisplay1) ||
                CheckAndModify(pbDisplay2) ||
                CheckAndModify(pbDisplay3) ||
                CheckAndMovify(pbDisplay4);


Or, I suppose a loop would be possible:

foreach (var pbDisplay in new[]{pbDisplay1, pbDisplay2, pbDisplay3, pbDisplay4})
{
    if (CheckAndModify(pbDisplay))
    {
        break;
    }
}