Yes correct the diode won't limit the current directly however it will do the thing, since 4.2v and 0.7v add up to 4.9 volts. I use it myself, the LED backlight has a resistor but that is not enough, very bright, adding a diode, brightness dropped down to moderate levels. It's not always handy to have so many resistors around.
So, what configuration did you use? Would it be too much to ask for you to take some pictures? I'm having the same problem and it's driving me crazy.