I have a Square S4 reader. Is there any way to use this to read arbitrary magnetic strips for security research? I have heard that the output is encrypted - is there any client software I can use to decrypt?
The data is encrypted with keys held by Square. You cannot decrypt that data.
If you want to use a Square Reader in your own mobile payment application, you can use our API, https://docs.connect.squareup.com/articles/point-of-sale-api-overview
If you're interested in Square for security research, remember that we have a bug bounty at https://hackerone.com/square
If you just want to read card data, I recommend buying a generic reader that doesn't encrypt the data. You can find them on ebay for $15.