Ok, here you go. I hope this is what you are looking for.

attached zip has ETC Source Four fixtures, right?

Yes, that is correct.
Just so you can see what I see, I am including two screenshots.
The only difference between the two is the LC engine. I replaced the "LC" application only.
The screenshots are labeled by the engine.

Yes, now I can see.
You are talking about Frame Shutter.
It orientation has been fixed from v41 to v42. That's why you see incorrect edges, this is fixing of "Frame Inverse" bug. Now just go to setup and inverse Frame (-X,-Y buttons in right-bottom of screen) for each custom's frame-fixture and you will see the picture how it should be.
Hope that helps!

No, I am not talking about the position of the shutters.
I am talking about the frost effect that softens the edges.
Notice in the pictures I posted, in v412 the edges are very soft.
In v43 the edges are hard lines.
I tried what you suggested but it did not solve the problem, it just changed the position of the framing shutters.

What I would really like it just to be able to add frost the same way I add color, just like we would do with a light in real life.

There never was the frost effect on Frame-Shutters. Please note, that Frame is a function after the frost. You saw soften edges on v41 because it apply Frame on gobo's pixels and quality of this depend of gobo resolution in Camera Quality Menu. This was changed in v42 and now Frame rendered exactly at screen's pixels. So, there is no bug in v43 engine that you are talking about.
You are able to add frost after color, no problem. You can do that in Constructor on driver's basis, or in main setup exclusively for each fixture. But remember, the Frame shutter is a last function.

If you want to propose move the Frame to another position - we can talk with pleasure in different thread.
Thanks.

When I am using a leko in real life, I add a piece of frost, usually R119, to the end of the leko, where I place colors, to soften the edges.

Is there any way we can get the same effect in LC? Isn't the whole idea to have an accurate simulation?

This method is not accurate. Lekos don't have a frost after their color system, because they don't have a color system. We add the frost and color to the outside.

Just for lekos and other conventionals. Moving lights are not the same.