There are precisely two ways, up to conjugacy, of embedding $SU(2)$ into $SO(4)$. The restriction of the natural action of $SO(4)$ to either of these $SU(2)$s gives a free, transitive action of $SU(2)$ on $S^3$.
To see this, first note that the images of the two $SU(2)$s in $SO(4)$ which you've found are not conjugate in $SO(4)$ (because they are both normal in $SO(4)$, being the images of normal subgroups in $SU(2)^2$). However, any other subgroup of $SO(4)$ which is isomorphic to $SU(2)$ is necessarily conjugate to one of these two. Here a sketch of why that's true.
Consider an injective homomorphism $\overline{f}:SU(2)\rightarrow SO(4)$. By the lifting criteria for covering maps, there is a unique lift $f:SU(2)\rightarrow SU(2)\times SU(2)$ of $\overline{f}$ with the property that $f$ maps the identity to the identity. One can easily show that $f$ must also be an injective homomorphism.
I claim that there are only two such $f$, up to conjugacy, for which $\pi \circ f:SU(2)\rightarrow SO(4)$ is an injective homomorphism. Establishing this, because $\pi\circ f = \overline{f}$ (where $\pi:SU(2)^2\rightarrow SO(4)$ is the double covering map), this implies there are at most two such $\overline{f}$ up to conjugacy.
First, it's clear that there are at least two such $f$ given by the inclusions into each $SU(2)$ factor of $SU(2)^2$. Since these factors are both normal, they are not conjugate to each other. Now we show that these are the only two.
For this, notice that a map $f:SU(2)\rightarrow SU(2)^2$ is really given as a pair of maps $(f_1,f_2):SU(2)\rightarrow SU(2)^2$, where $f(A) = (f_1(A), f_2(A))$, so this reduces the problem to understanding all maps $f_1:SU(2)\rightarrow SU(2)$. If both $f_1$ and $f_2$ are trivial, then $f$ is not injective, so we assume wlog that $f_1$ is nontrivial.
We interpret $f_1$ as a $2$-d representation of $SU(2)$. But the representations of $SU(2)$ have been completely classified - every representation breaks into a direct sum of so-called irreducible representations, and there is a unique irreducible representation of every (complex) dimension. Because $2=2$ and $2=1+1$ are the only parititions of $2$, $f_1$ is equivalent, as a representation, so either the trivial representation or the standard representation. Since it's not trivial, $f_1$ is equivalent to the standard representation.
Mal'cev has proven that for maps into $SU(n)$ (and in fact, maps into $U(n), Sp(n), SO(2n+1)$, but not $SO(2n))$, the induced representations are equivalent iff the images are conjugate. Thus, applying this to $f_1$, we know that $f_1(A) = BAB^{-1}$ for some $B\in SU(2)$.
Working back to $f$, we now know $f$ either has the form $f(A) = (BAB^{-1}, CAC^{-1})$ for some $B, C\in SU(2)$, or $f(A) = (BAB^{-1},I)$ for some $B\in SU(2)$. In the first case, we note that $f(-I) = (-I, -I) = -(I,I)$, and hence, $f(-I)\in \ker \pi$. This implies $\overline{f} = \pi \circ f$ has nontrivial kernel, a contradiction. Hence, $f(A) = (BAB^{-1},I)$ for some $B\in SU(2)$. This proves there are precisely three nontrivial homomorphisms from $SU(2)\rightarrow SU(2)^2$, but only 2 which give injective homomorphisms $SU(2)\rightarrow SO(4)$.