Electrical current must flow in a path, to and from the battery/alternator.
Therefore it will always be choked down by your smallest wire gauge regardless where it is.
The official (wikipedia) copper resistance of 4ga is 0.25mOhms/ft.
You said the fuse rating is 160a. So at potentential max current draw you could get a 0.8V drop across your 20feet of 4ga wire.
0.25m * 20' = 5mOhms.
160a * 5mOhms = 0.8V drop.
160a*160a*5mOhms = 128W of power loss in the wire.
Given, 4ga wire is only rated for maybe 100a so it might be slightly stressed by that 160a.
0ga will only be better.
In general, always use the larger wire for long cable runs. Less resistance, less voltage drop.