So could you give them a PQ 4 planet, Conquer their other planet, and then then wait for that planet to become PQ 21, and then give them another PQ 4 and strike again taking the new PQ 21...then rinse, wash, repeat? or does the planet become PQ4 again once you take it?
The planet will stay at whatever PQ it was when you took it. If you are going to wait for the minor to get the polanet to its full potential you'll be waiting for a long time. At beast you'd have to give it the terraforming techs, and then you'll still have to wait for it to build. I don't know if the minors ever pick ethical sides, but if its a neutral, you may want to give it Good and Evil tech so it will have it fully terraformed. But then, if you had that tech and were neutral it would be done already.
I always have at least 10 PQ1's in a game and i colonize them all. I had a recent thread on my "third" colony rush. Thoase really do become some of the best planets in the game. For me they are most commonly PQ 16 - 19. WIth a good midgame economy you can rush build a munufacturing center or stock exchange everty turn. If you play as the Thalans you can rush buy an Idustrial Center.