There is no way to my knowledge that someone can install windows 10 lite/slim/thin/OnDiet/ in a 4 GB space, VHD or not. The iso might be 1-2 Gb but when the files are installed, they cant be less than 10 GB, let alone swap, etc, and then you need room for the application you want to test plus any security software to scan it. The only notable exception is windows PE.
Not saying that using VHDx is a bad way, but it's not the best way either as you claim. I've been using VHDx since 2005 when MS bought Virtual PC software (who remembers that?) especially to move the same OS/Software through various VMs and/or across various servers.
Just to give the benefit of the doubt, in your opinion, what's the advantage of a 30 GB VHD vs a 30 GB partition vs a 30 GB VM for testing reasons? In my view, if anything, it can be more trouble than using a sandbox/vm, 'cause one has to waste time with restarts/reboots.