Step 1: Concept
Use the double angle formula $2\sin \theta \cos \theta = \sin 2\theta$.
Step 2: Analysis
Group the terms: $[2 \sin(\frac{x}{4}) \cos(\frac{x}{4})] \cdot 2 \cos(\frac{x}{2})$.
The first part becomes $\sin(\frac{x}{2})$.
Step 3: Calculation
Now we have $2 \sin(\frac{x}{2}) \cos(\frac{x}{2})$.
This equals $\sin(2 \cdot \frac{x}{2}) = \sin x$.
Final Answer: (B)