Given $n$ digits, there must be exactly one power of $2$ with $n$ digits such that the first digit is $1$. Thus $S$ contains $603$ elements with a first digit of $1$. For each number in the form of $2^k$ such that its first digit is $1$, then $2^{k+1}$ must either have a first digit of $2$ or $3$, and $2^{k+2}$ must have a first digit of $4,5,6,7$. Thus there are also $603$ numbers with first digit $\{2,3\}$ and $603$ numbers with first digit $\{4,5,6,7\}$. By using complementary counting, there are $2004 - 3 \times 603 = 195$ elements of $S$ with a first digit of $\{8,9\}$. Now, $2^k$ has a first digit of $\{8,9\}$ if and only if the first digit of $2^{k-1}$ is $4$, so there are $\boxed{195} \Rightarrow \mathrm{(B)}$ elements of $S$ with a first digit of $4$.