It seems to me that LC4 key is essentially equivalent to RC4 state and thus RC4 early keystream bias does not apply as there is no key-expansion phase.

Edit to clarify: LC4 key has to be permutation of 36 elements, while RC4's state is bijection of 256 elements that is somehow construed from the byte-string key and the issue is in how this string->state transformation works (ie. you have to pump the function for >500 times to get unbiased output).