Yes, all the profiles that came with my installation of CloneCD 4 have the intelligent bad sector option enabled. It doesn’t seem to affect my LiteOn LTR-40125S from doing copies of SafeDisk2 games, since I’m able to backup MOHAA, Max Payne, and Freedom Force with my LiteOn using the default Game CD profile, and all the backups work great. I’ve also made a couple audio CD copies too using the default audio CD profile, and those are fine too.
Personally, I think version 4 of CloneCd is much easier and quicker to use than version 3. I’m able to setup new profiles for backup testing and know later what settings I used. It’s very easy to enable and disable settings (such as the intelligent bad sector option) in the profiles to figure out what does and doesn’t work. I find it extremely flexible and myself wouldn’t even think about going back to the prior version.