This may be because I have used three of the land types in my level, as well as nearly all the tiles in the Masked Tileset. In Keen4, no level has that variety of foreground tiles.
Should I make my level smaller (it's currently 120x120), or should I do without one of my land types?
Use fewer different tiles -- the Keen 4 engine tries to load all the tiles you have in the level into memory; I'd say the variety of tiles you're using won't fit into memory at once. (Note that the memory limitations have nothing to do with the amount of RAM or video RAM in your system).