I think that's also OK, as long as 3 days rest means three off days, not pitching on the third day. E.g., pitch on Monday, not again until Friday.
Also, this is for the occasional tournament, not something you would do every 4 days for 3 months. Over the long haul one long outing per week is plenty.
That being said, we have used kids for a short outing, then brought them back for a longer outing in the same week, even the same weekend. For example, in your typical youth weekend tourney, a kid goes 2 innings (under 30 pitches) Friday night, then goes his limit on Sunday. Since he would've thrown a hard bullpen to prepare for Sunday had he not entered the game, I did not consider this abusive, just part of the normal practice and preparation cycle. But this was for a team playing maybe one tourney every 3-4 months, not every weekend.
There are a handful of special events, like a national championship, for which I think you could justify stretching it a bit -- a once a year kind of thing. And if you're at the end of the season where you can shut it down for a month or more afterwards, stretching the pitch count a bit is OK in my book.
My concern is more with those who exceed recommended pitch counts, or fail to allow adequate rest intervals, regularly and repeatedly. With this kind of thing the boy just never gets the opportunity to heal from the last time before he's at it again.
But don't get me wrong. Even with truly special events, anything can be overdone. I see these kids on TV in Williamsport every August throwing 6 innings, over 100 pitches, every other day for a week and I cringe. Some of them go to 130 pitches, and Little League allows it all to happen while Brent Musburger gushes about how tough the kid is. I guess for most kids that's the pinnacle of their athletic careers, so maybe they feel they have nothing bigger to save themselves for. But the fact is, you never know that until later, and if you hurt the boy, you'll never get to find out.
In addition to exercising some common sense, as a coach you have to get used to interrogating your kids. Most of them have the attitude that they are, or are supposed to be, indestructible. They will often lie to you and say they're fine when they aren't. A coach has to know this and thus, the "he told me he was OK" excuse doesn't cut it. You have to develop a rapport with these kids so that you know when you are getting the unvarnished truth and when you aren't. Even if the numbers suggest it might be OK to throw a kid, if he's in pain already then you can't send him out there.
You also have to know when you're asking so much that it's really your fault for even asking. The kids are by definition immature, they don't appreciate the long-term ramifications of the decision right in front of them. You have to have the maturity to put the boys' health ahead of the immediate desire to push and push for that supposedly big win.
Part of what makes this keep on happening is that the harm doesn't pop up at the moment of the abuse. It lies hidden beneath the surface and crops up later on, after the "big win" is a distant memory. People remember what they did to get that "big win" and they keep on doing it. They express sympathy when that boy needs elbow surgery two years later, but they don't connect the two events from a cause and effect standpoint. Surely it was all caused by something closer to the day when he felt that awful "pop"?
But so often the shoulder and elbow are like fraying ropes. A strand pops here, a strand pops there, and then all of a sudden one day, you don't have enough strands left to hold it all together any more. The amazing thing about the human body is, if you let it, it will heal. And if you condition it correctly, it won't get hurt as much in the first place. Good coaching has to take all of that into account and work the kids correctly from the start of practices through the last game.