How to delete data from an old iPhone?

If the phone is being recycled, it is going to be broken down into its basic materials. As long as the phone had a password on it, the data is encrypted and will not be accessible to anyone else.

If it were me, I wouldn't spend the time going through the recovery process.

If you forgot your Apple ID password - Apple Support

In order to factory reset your iPhone 4 you need your Apple ID and password, if you have proof of ownership you can see if an Apple Store recycling is including it. Otherwise keep it (smash it?)