Don,
It’s a manual process. MyEclipse won’t automate this process for you, but if you have already changed out all the libraries yourself (e.g. remove the J2EE 1.3 Library Set, and add the J2EE 1.4 Library set to build path) and you just want MyEclipse to “know” it’s a 1.4 project, you can edit the .mymetadata file and change the j2ee-spec variable to 1.4:
j2ee-spec="1.4"