2.) I would vote for directly balancing around 4 party members instead of "the maximum allowable." This will ensure that parties of 6 or 2 are not too unbalanced since these party sizes are not that far off from 4. (If you directly balance around 6 party members, then a party of 2 will probably be very unbalanced)
I mean, I don't really think we are voting for anything here, since regardless of what we want they going to make their own decision :P
I would probably do something like this. Party XP is divided by 1+the total number of characters in the party. If there are 4 party members, its divided by 5, if there are 5 party members, its divided by 6. You get the idea. This creates a slightly more compact XP spread than if you were straight up dividing by the number of party members. A party of 1 would only earn 3.5 times as much XP as a party of 6. They would obviously balance the XP awarded around the party size they want (in this case, lets say 4), but in my opinion, figuring out how to divide it is the more important part and you want the amount of XP awarded to not scale as high up as it would in smaller parties if you just did straight division.
