"When the second paragraph says "dwelling by means of this dwelling" it seems to be referring to the prior paragraph, in which it is stated he is attending to the " imperturbable", which I have been lead to believe is the 4th Jhana"
While it seems like so, it's actually not. If you go on to the subsequent paragraphs, they all start with that phrase "dwelling by means of this dwelling", for example:
"while he is dwelling by means of this dwelling, his mind inclines to speaking, he resolves that 'I will not engage in talk that is base, vulgar, common, ignoble, unbeneficial, that does not lead to disenchantment, dispassion, cessation, calm, direct knowledge, self-awakening, or Unbinding — i.e., talk about kings, robbers, & ministers of state; armies, alarms, & battles; food & drink; clothing, furniture, garlands, & scents; relatives; vehicles; villages, towns, cities, the countryside; women & heroes; the gossip of the street & the well; tales of the dead; tales of diversity, the creation of the world & of the sea; talk of whether things exist or not.' In this way he is alert there."
So if the monk was in the 4th jhana while walking, he must've also been in one while speaking!! (which is definitely impossible..)