I think the problem is the lack of hiding spaces in the tank. If the jag is eating, then okay but it makes it a lot harder for a fish to feel comfortable in a new tank with only two rock caves.
The fact that a 4" fish is in a 30 gallon tank is not the problem. A 30 gallon tank is 3'x12"x16. Saying that is too small is like saying a 9'x3'x3' tank is too small for a 12" jaguar, and that is ridiculous.
American cichlids tend to get skittish and hide a lot when moved to a new environment. Especially poorly bred cichlids.
My only advice is, if the cichlid doesn't come out of it's shell add a ton of rocks and driftwood and decorations. If your fish can pick it's own hiding spot, instead of you picking it for the cichlid it will feel a lot more comfortable.