I think the code below will do what you want (semi-tested). But I'd have to booster pretty strongly against the perl solution. In this case you probably should do it with CSS. If the blockquote is truly a "quote," okay, but if you're only changing it for the formatting, you should format from without. Both solutions are below. 

use strict;
use HTML::TokeParser;
use CGI qw( blockquote );

my $string = join '', <DATA>;

my $string_ref = \$string;

my $p = HTML::TokeParser->new( $string_ref );

my $html;
my $last_end_tag;
while ( my $token = $p->get_token )
{
    if ( $token->[0] =~ /[TCD]/ )
    {
        $html .= $token->[1];
    }
    elsif ( $token->[0] eq 'S' )
    {
        if ( $token->[1] eq 'p' and $last_end_tag eq 'h4' )
        {
            $html .= blockquote( $token->[2],
                                 $p->get_text('/p')
                                 );
            $p->get_token(); # toss the </p>
            $last_end_tag = 'blockquote';
        }
        else
        {
            $html .= $token->[-1];
        }
    }
    elsif ( $token->[0] eq 'E' )
    {
        # if it's a new blockquote, it's closed already
        $html .= $token->[-1]
            unless $token->[1] eq '/p' and $last_end_tag eq 'h4';

        $last_end_tag = $token->[1];
    }
}

print $html;

__END__
<p>Stand alone p, or, aw, skip it.</p>
<h4 class="title">This is an h4</h4>
<p class="salad" id="taco">A first paragraph.</p>
<p>A follower.</p>
<p>Big finish. Or Finnish?</p>

[download]

CSS solution.

blockquote {
 /* format definition, whatever you want... */
 margin:1em 1em 1em 2em;
 font-style:italic;
 font-size:105%;
}
h4 + p {
 /* format definition identical to your blockquote def */
}

[download]

update: fixed grammar flatulence + one more, sigh.

In reply to Re: HTML module help please? by Your Mother
in thread HTML module help please? by Cody Pendant

Title:
Use:  <p> text here (a paragraph) </p>
and:  <code> code here </code>
to format your post, it's "PerlMonks-approved HTML":


  • Posts are HTML formatted. Put <p> </p> tags around your paragraphs. Put <code> </code> tags around your code and data!
  • Titles consisting of a single word are discouraged, and in most cases are disallowed outright.
  • Read Where should I post X? if you're not absolutely sure you're posting in the right place.
  • Please read these before you post! —
  • Posts may use any of the Perl Monks Approved HTML tags:
    a, abbr, b, big, blockquote, br, caption, center, col, colgroup, dd, del, details, div, dl, dt, em, font, h1, h2, h3, h4, h5, h6, hr, i, ins, li, ol, p, pre, readmore, small, span, spoiler, strike, strong, sub, summary, sup, table, tbody, td, tfoot, th, thead, tr, tt, u, ul, wbr
  • You may need to use entities for some characters, as follows. (Exception: Within code tags, you can put the characters literally.)
            For:     Use:
    & &amp;
    < &lt;
    > &gt;
    [ &#91;
    ] &#93;
  • Link using PerlMonks shortcuts! What shortcuts can I use for linking?
  • See Writeup Formatting Tips and other pages linked from there for more info.