We show that in mesoscopic four-terminal thermoelectric devices with two electrodes (the source and the drain) and two heat baths, inelastic scattering processes can lead to unconventional thermoelectric transport. The source (or the drain) can be cooled by passing a thermal current between the two heat baths, with no net heat exchange between the heat baths and the electrodes. This effect, termed as cooling by heat current, is a mesoscopic heat drag effect. In addition, there is a transverse thermoelectric effect where electrical current and power can be generated by a transverse temperature bias (i.e., the temperature bias between the two heat baths). This transverse thermoelectric effect, originates from inelastic scattering processes, may have advantages for improved figures of merit and power factor due to spatial separation of charge and heat transport. We study the Onsager current-affinity relations, the linear-response transport properties, and the transverse thermoelectric figure of merit of the four-terminal thermoelectric devices for various system parameters. In addition, we investigate the efficiency and power of the cooling by transverse current effect in both linear and nonlinear transport regimes. We also demonstrate that by exploiting the inelastic transport in the quantum-dot four-terminal systems, a type of Maxwell's demon can be realized using nonequilibrium heat baths.