I'm on the fence on this one. In theory I like the concept but circumstances played out very differently in our family.
When the dc were small, DH saw toys as luxuries rather than necessities. But he also came from a background of over indulging at Christmas, so it became my opportunity to buy good, long-lasting toys that are important for play and development. It would have been great if our relatives could have been guided a little bit but several of them believe that the true meaning of Christmas involves showering dc in plastic tat. And if I didn't buy decent toys at Christmas it would be impossible to justify buying any more when we were drowning in plastic.
I have a voracious reader who devours 5-10 books a week and also hoards so we spend lots of time in the library! He wouldn't really see the value in a book that he could borrow for free. I have one who would re read a favourite book a dozen times so he would value a book as a gift, and I have an emerging reader who is intimidated by books, and it's just not the right time for a gift of a book.
I have a child who loves clothes, and one who covers his nakedness reluctantly but would be very disappointed to receive clothes as a gift. The other would probably be indifferent.
And then there's the "want": once they go to school they want some inappropriate rubbish. One year it was a stupid flying fairy that looked amazing on tv and crashed uncontrollably in RL. DS had his heart set on it and Santa brought it, but also brought a popular toy to give a child with asd who was struggling socially a bit of street cred in school.
Whatever nonsense they ask for, on Christmas Day you also need them to be occupied happily either while you're busy in the kitchen, or to help survive in someone else's house. A big Lego set, or a craft box is great but it's another gift.
Then there is the comparison factor; fairness matters hugely to children and I don't think Christmas Day is the time to teach them how life is unfair (there's another 364 days for that). But do you give them the same number of parcels, or the same size if parcels. It takes several years to understand monetary value, and many, many more to understand relative needs.
So on Christmas Day we end up with a pile. I don't post on Facebook or show anyone the size of the pile. I'm not following class norms or keeping up with the Jones. I'm just trying my best. I'd be far more comfortable with a quieter, calmer, less material Christmas.
If I could persuade my relatives to back off with the presents (or give them some of mine) it would be brilliant but currently my DSis and Sil are in direct competition for the most extravagant auntie title 
I suppose my point is that the four gift rule might not cover everything that life throws at you.
I try and balance it by encouraging my dc to give gifts that they make (and to help me think of gifts too so they have to focus on the other person and not just suggest what they want themselves). We give gifts to people who have helped us (nurses, paramedics last year), and we practice lots of acts of kindness through advent. Hopefully that counter balances the over consumption a little but I'm still trying to figure it out.