There is no rule that says you need to use the largest unit available, on the opposite the unit used often indicates the precision of the measurement taken. If you say something is 400mm, it's normal to assume that means 400±1mm. 4dm would be ±1dm.

That would be "4.00 decimeters". People tend to skip decimeters entirely tbh, large things are measured in meters, small things in centimers, tiny things in millimeters. It is true that my desk is 8 decimeter deep and 24 decimeter wide, but it was listed as 2.4x0.8m in the store.

All deci- are rare actually. I sometimes encounter deciliters in recipes, but they're just as likely to go for 10 centiliters or 0.1 liters.

anyone who has worked with blueprints has it hammered into them that you ALWAYS use millimeters to prevent confusion, go complain to the engineers who make sure the buildings you're in don't crumble apart.