When I first recieved the heli it seemed to have alot more lift than what it does now. Now I cant seem to get it more than 4 feet high? I have a second battery as well which is new(9.6v NiMh) with the same result.
It's either your batteries or your motor. Are you sure your batteries are getting a full charge, what are you using for a charger?
Are you using the stock motor? The motor that come with those micro heli aren't much good, they don't last very long. I have read where people have only got 20 flights out of them. I only got about 40 flights out of mine and I had to change it. The heli only coming off the ground 4 feet is a pretty good sign that the motor is toast (if your batteries are taking a full charge). Get yourself a brushless motor and you will see a big difference.