Hi there, hope you are enjoying BYC!
Okay, so according to my understanding and what I am seeing here.. 4 inches is a fairly long egg and I would THINK having humidity too high, which would allow the embryo to grow too big to turn into place for hatching and essentially be malpositioned at pip.
I have never had an embryo/chick be too small to hatch as it should grow to the size of the shell. An embryo that was too small to hatch, might actually internally pip and drown from humidity being to high.
And aside from that... hatch can fail for SOOOO many reasons. Did you have any other develop and hatch with the incubation of that eggs and if so on what day? Also, what is the age and breed of bird? What incubator are you using and where do ya run it at regarding temp/humidity?
One of the best hatching resources I like to use, hatch fail analysis according to what day the embryo quit starts around page 52...
Incubation guide
And another analysis resource to review...
https://ufdc.ufl.edu/IR00004437/00001
I see you are in Utah... how high is your elevation?
I see now you call it a rainbow layer. If you haven't incubated it yet and wanna try... go for it, you never know till ya try and while it may not be an ideal shaped egg for incubation, if you like that hen.. I have hatched plenty of imperfect eggs with absolutely perfect chicks! And the opposite... some perfect eggs that either didn't hatch or even possibly hatched a deformity. So many unknowns, it's always an adventure!
Good luck and happy hatching!

