On Needles and Yarn

Abby posted a comment with a great question:

"I was wondering... this is for a worsted weight yarn, and the gauge'll be 21-25 sts/4 in, depending on the st used, but on size 4(!) needles? I was perusing the french kal and saw some exclamations about this over there as well. Apparently size 4 needles do indeed produce something "joli mais extrèmement serré" (pretty but very tight), while size 5s create a too-loose gauge, and doesn't look at good. I suppose the size 4 thang is right, given that the photo makes the resultant fabric look pretty dense - that's part of its appeal.

Also, given that it calls for size 4s, I'm thinking of using my sweater-sized stash of Knitpicks elegance, which is DK, and maybe bumping my needles up to 5s. Any thoughts - do you think this 70% alpaca/30% silk yarn would have too much drape for a part-cables sweater?"

On needle size, I thought Pure Laine 3,5 was a DK weight yarn. According to this shop, it's 21 st = 4". It seems like Knitpicks Elegance (I think the silk would be nice) or Merino Style would substitute well.

Being too eager to wait for the other knitters on the French knitalong, I started with my yarn-of-undisclosed gauge (bought at School Products in bulk) on size 5 needles because I feared overly-constricting the cashmere. I measured gauge not by doing a swatch in the actual patterns (nooo that would have been too smart!) but seeing whether I could match the 21st/4" in stockinette one is supposed to achieve with Pure Laine 3.5. It seemed to work on 5s, but...

Although I love the resulting plush fabric, I fear the end result might be too large. Unstretched, it's several cms under the 40 cm the pattern predicts for the smallest size, but stretched out, it seems to be way over the 40 cm. Does anyone know the proper way to measure ribbed fabric to see whether it matches gauge... stretched or unstretched?