Why do conferences have such short page limits?
There are a number of inter-related reasons for short (and shorter) conference paper lengths:


The 10-12 page limit is typically so that reviewers don't have to review an inordinately long document. 
Final versions are also limited in length because the fact that proceedings are now mostly electronic doesn't mean that the cost of publication is independent of paper length. Editing costs are per-page (one can of course argue that professional editing does little for a conference paper, but nevertheless that's how it's priced).
in order to make sure "what you review is what you get", one generally enforces the page limit at submission time as well
finally, the 4-page limit I suspect is so that a fleshed out version of the work can be published in a journal without questions about the level of original content over and above what was presented at the conference. In this sense, the 4 (or 2 page) conference version is merely a short advertisement.