From what I remember this starts looking for the Modular form of the default controllers: i.e. Default_IndexController instead of the traditional IndexController classname. Might want to consider disabling this unless it's absolutely needed. For 404 handling there's a new action helper called Zend_Controller_Action_Helper_ErrorHandler. It's enabled by default (just like ViewRenderer) in 1.0.0 RC1. All you need is an ErrorController class with some relevant action methods.

Documentation on it seems scarce - the Migration document notes in just a few lines before tackling the more obvious issues arising from the ViewRenderer.