I use steam the latest release does support steam and even liberty city stories, although it doesnt look as good as modding 1.4
icenhancer just changes some lighting effects a couple of textures and adds more anti aliasing options...
most of the youtube vids are using a combination of mods..
try adding better city textures, real hd car pack, busy city mod, add a realistic trees/roads and any other mods .... just remember to back up gta 4 files before you start
currently i'm using this guy's version of icenhancers 2.0 with the above mods
even though i kept the original sky texture cos ^ that mod goes a bit OTT with the stars
Extract the contents of the folder depending of what version you want to use.
Go inside the folder.
Select EVERY FILE inside. Even folders. Everything.
Copy them.
Go inside the GTA 4 folder (/Rockstar Games/Grand Theft Auto IV)
Paste them here.
Remember to back up your gta 4 folder first .... then you can start experimenting with other mods....
"Busy city" is awesome ...
If it asks to replace files. Press YES.