Every time i attempt the 1234 4321 2345 5432 exercise or similar exercises till the 12th fret my pinky always raises about an inch or more above the fretboard when my ring finger frets a note. Is there a trick to build finger independence? Or must i start dead slow (like 10 beats per minute) and build it from there?
It's sympathetic tension. Your third finger and your pinky share a tendon so whenever you move one the other moves a bit as well. You can get a similar problem with other fingers but it's not as common. Starting dead slow and trying to reduce the movement as much as possible is the way to go

Edit: You probably won't ever get all the sympathetic motion out of your pinky but that shouldn't stop you trying to reduce it as much as you can!
You have to really concentrate on keeping your pinky still when the ring finger moves up and down. Also, don't work on your technique while watching tv or something. You should really pay attention and think about everything you do.