Well, for one, she sucks for not explaining her reasoning to you. My guess is that it's because she doesn't know why herself, and is just going by the size someone else told her each height of person should ride. That or maybe she's just poor at her job. Also, I wouldn't ride a MTB that I barely had clearance on. I know some do, and I know a lot don't. I know that I personally am going to encounter hills and the like that will require me room to dismount in situations that are sometimes less that ideal flat ground. In those situations, you often need those extra couple inches to get your feet stable without compromising the safety and comfort of your crotch. I think I've got 2" of room on my bike. As for the stem, that just depends on the bike. If you look at a downhill bike, many of them have basically no stem. If you look at some XC bikes, many of them have 90mm stems. Any bike made to fit any number of riders might be anywhere in between. It just depends on the bike and how it's designed. The most important part is that you're comfortable physically on the bike, and mentally comfortable with the bike. Who knows, maybe it'll be one of those crazy 26" wheeled bikes with a longer stem.