New Jersey law has no length restrictions on knives carried by adults. Measuring by the width of a palm is legally meaningless, palms varying. If they want to say under 4", let them say so -- it is not in the statutes.
As with anything, how you present yourself counts for a lot. I walk with a Canemasters combat cane, carved grips and fangs on the end of the crook. No one has ever questioned it, not in New Jersey, not even in New York City. A teen walking with a tire-knocker would get called on it, I'm sure.
I despise the mindset that demonizes self-defense. Self-defense should be THE valid reason for carrying any potential weapon. But we have to be aware of the defects in our laws, and defend ourselves from them as much as we would defend ourselves from a mugger.
In this sense, the police are NOT our friends, even if individual officers may be. Don't wave it around, and don't talk about it to people who don't share our understanding. And don't mention self-defense outside our community, either. The others don't want to understand.