The mother of a toddler who died of respiratory failure at a Palos Heights hospital have settled their lawsuit for $4.25 million.The parties reached the agreement in late November, but it still awaits formal approval by a Law Division judge.On Oct. 16, 2011, 23-month-old Ryan Kutchinski Jr. was brought to the Palos Community Hospital emergency room just before midnight experiencing fever, runny nose and cough.Emergency Room …