To answer your first question:
You can use a Nexus 4 as a simple wifi device without a sim card at all if you don't want cellular data.
As far as updates go, that is harder to say. I would be shocked if the Nexus 4 doesn't get Key Lime Pie. After that? Who knows... but I'd say the same for the Nexus 7, even the newer one. Key Lime Pie will probably be around for a long while with minor point upgrades much like Jellybean was.
In any case, if this is for development I wouldn't worry about it that much. There are relatively few points where Android diverged enough that it makes a huge difference to developers if the OS they are developing on is the very newest or slightly older.
For example, you can pretty much target Ice Cream Sandwich and above right now and it makes very little difference in terms of how you develop and which APIs you'd use.
And if you have to develop on systems even older than that, the combination of the Android Support Library here:
http://developer.android.com/tools/support-library/index.htm...
And ActionBarSherlock here:
http://actionbarsherlock.com/
do a good job of smoothing this sort of thing out from a developer's point of view even if you're developing on Froyo or Gingerbread era devices.