I have a 1997 ford escort that won't start, have tried new ignition, new
relay, traced all electrical wires but no go. when testing voltage level in
the ignition it is 12 volts, but when you turn the key to on it goes to
4.5 volts and the dashboard goes dim.

Any ideas, we are at a loss

Please help.

Have you tested the starter?

Does all the electrical stuff in the car work prior to turning the key? (wipers, radio, etc.)

The starter is fairly easy to remove, especially from underneath if you have the means to get the car up off the ground. Take it out and bench test it.

You don't say whether or not the engine turns over. Try jump starting it. If it starts it's probably your battery.

It's common for the voltage to go down when hitting the starter. 4.5 residual voltage is about right when the starter is engaged. If your battery is over 5 years old I would replace it.