Congratulations on your new baby, and on the wonderful family it sounds like you already have! I, too, have a 4 year old, 2 year old, and my baby is 7 months old. The situation you had with your daughter sounds like it was very challenging! I wish you better luck this time. What course of action you choose probably depends a great deal on the individual child, but you have to do what works for your family. I can share my story, and hope it helps and gives you hope.
My daughter, who was 19 months old then, was not known for how well she handled transitions, so when we were expecting our second child and I knew this transition was coming, I started strategizing. I planned to have my husband assemble the bed and have it in the room for a month or so, so she could get used to it. I planned to find a book about moving into a big-girl bed, etc. I wanted her to be totally acclimated to her new bed before the baby came, even though the baby would be in a bassinet in our room for a while. I never wanted her to feel 'forced out'. Anyway, I had bugged my husband to assemble the bed, since I wanted it to be in the room for a while before we started any transition. He spent all day assembling the top bunk of a bunkbed set, which we planned to use because of the full rail. (The wall provided the enclosure for the other side). Just to clarify, we didn't use it as a bunk bed set at this time, just as a single bed. That was just our future plan. Anyway, when Eric was all done assembling it, I started telling him my plans for how to slowly start this transition. He just laughed, and thought I was making it way too complicated. He said he wanted to try having her sleep in it that night! I, having researched how difficult this can be, thought he was absurd, but was willing to go along with it.
We put Madeleine down to sleep that night in her new big bed. We had moved the crib to the other side of the room, and put the bed in the same location in the room her crib had occupied. We tucked her in, said goodnight, and then waited outside her room to see if she'd come out. She never got out of her bed, but went right to sleep. It was a month or two before she ever tried to get out. She applied the same rules to her bed that she had to her crib. She'd call for us to come get her. She'd occasionally point to her crib with a quizzical look, but never made a fuss about it. By the time her sister moved in there months later, it was a non-issue. Actually , the first time she climbed out was during a nap, during which time she made a total mess of her room and then got stuck between the sliding closet doors! It scared her so badly she didn't try to get out of her bed again for at least 6 months!
I was so sure that it would be hard, and it was a piece of cake! It was the same when it came time for Guinevere to move out of the crib when we were expecting our son.
Hope this helps!