Yes, if he's got decent training, either WP or not, then she'll do just fine on him in 4H. Whoever rides him just needs to be aware that he's likely to be really soft in the face and on his sides so very little cue is necessary. Also, don't get after him if he slows down when you put leg on; like OVO said, some WP horses have a spur stop in their training.
Since you've got a friend with experience in that discipline who has ridden the horse, you might think of getting your sister some lessons with her to learn the ins and outs of his training and how to get the most from him.
As for riding him on trails, that's anyone's guess. There are a lot of horses, especially show horses, that never see the outside of an arena so they are completely unprepared for the sights and sounds of an actual trail. Some turn into Mr Hyde and others just get a bit looky, depending on their temperament. Either way, I'd make sure that there was an experienced rider on him the first few times you take him out on a trail, just in case he has a come-apart.
He's a pretty guy and I'm sure he'll make a great all-around horse for your little sister