Dragon Quest IV's distinguishing characteristic is its chapter-based structure. The game is split into five chapters: the first four chapters introduce most of the major controllable characters, while the fifth chapter encompasses the majority of the story. While I am still only in the fourth chapter, I think that the chapter based structure is a great idea. The four early chapters do an excellent job of setting up the central conflict in a believable manner and making a large number of characters interesting.
Establishing the history and motivations of a large supporting cast is easily the most important outcome of Dragon Quest IV's Chapter structure. Compared to most Dragon Quest games, Dragon Quest IV has a lot of characters. I have been introduced to eight permanent characters so far, and there very well may be even more yet to be introduced. With a cast this large, it is very easy for characters to end up being underdeveloped or overshadowed by other characters. However, by giving various members of the cast their own introductory chapters, most of the characters of the game are put into the limelight as the central character in their own fairly involved adventures. These chapters introduce most of the cast as adventurers and heroes in their own right, before they are ever recruited by the main hero. These chapters introduce the various characters' motivations for becoming heroes, as well as what sets them on the path to becoming part of the main party of heroes. As a result, the entire cast of characters becomes very interesting.
The four introductory chapters are also put to good use as a means of foreshadowing the central conflict of the game. While each of the first four chapters has its own self-contained story, most of them directly tie into the larger chain of events going on behind the scenes. Furthermore, each of the chapters has so far set up different facets of the plot and added various mysteries to the game. So by the time the main hero enters the action, a lot of set-up has already been done. The four chapters also flesh put a significant fraction of the game world, much of which the player will need to travel through again later on in the game.
A particular advantage of the four chapters of Dragon Quest IV is that all of them give the player different gameplay experiences. While some of the chapters are more focused on a single character, others give the player multiple characters to use. While some of the chapters are dominated by powerful physical fighters, others primarily have magic-oriented characters. The kinds of dungeons and situations the various characters come across vary wildly as well. Even the enemies that appear are pretty different. No two chapters are exactly alike, so in some way it feels like several different RPGs rolled into one. This variety keeps things plenty interesting as the player goes from one to another.
There is another game that takes advantage of the introductory chapter concept: Seiken Densetu 3. In that game, all six possible characters have their own unique starting chapter, usually consisting of a sequence of story events leading up to a short dungeon. Like in Dragon Quest IV, these prologues do an excellent job of introducing major characters and establishing their motivations for becoming heroes, as well as introducing various villains and the major countries of the game. However, I think the set-up in Seiken Densetsu 3 is not as good as in Dragon Quest IV because the player only has to play through the chosen main character's prologue, and only gets a cutscene summary of the other character's prologues. This does have the effect of marginalizing the plots of the two supporting characters, which is a trend seen elsewhere in the game.
Thinking about it, one can argue that the split-scenario section of Final Fantasy VI is more or less the same thing as Dragon Quest IV's Chapters. The scenarios too are something that occurs relatively early in the game as a means of temporarily putting the spotlight on individual characters. The scenarios in FFVI are even the time where several major characters are first introduced as well.
Personally, I love having individual chapters in an RPG. This is another device I would like to see revisited in the future.