We will be arriving into fussen by train at around 4pm, planning to take a bus ride to Hohenschwangau where we have booked for the 2 nights' stay, leaving for Munich the next morning. How can we make good use of these 1 & 1/2 days touring the King's castles, Oberammergau, and Linderhof Castle without a car. Is it a feasible?
No, it's not feasible to add Oberammergau and Linderhof with such a short time. Even with a car you'd need another whole day.
I wouldn't try it with a car. Even using Scotty's transporter, you could not due justice to all of those places in a single day. I spent more than half a day at Linderhof, including lunch there.
Would you recommend to cut one day short for a 4-day in Munich and its vicinities in order to accommodate more time in the castle region?
There is a bus that goes from Hohenschwangau to Oberammergau and another one that goes from Oberammergau to Linderhof. If you do all of it as a single trip, you might consider only one night in Hohenschwangau and take the late afternoon bus to Oberammergau for the second night (I know a good, not too expensive place there). Then take the morning bus to Linderhof, come back and see Oberammergau before training back to Munich via Murnau. I suggest that because the schedule from Hohenschwangau over to Oberammergau and Linderhof in the morning is pretty awkward. Alternatively, you could go to Munich after the second night but make a day trip later to Oberammergau and Linderhof. Both are accessible from the train line that comes out from Munich to Garmisch-Partenkirchen.