If you are 5'6", a 49 cm frame does sound too small.

BTW, toe overlap isn't limited to small frames. I'm 5'9" and have a 55 cm Litespeed and a 56 cm Co-Motion single bike and wear size 43 riding shoes with the cleats conventionally mounted fore-and-aft. All very middle size measurments and both bikes "suffer" from toe overlap. However, the only time it's apparent is during tight U-turns. I've never had any problems during normal riding or dodging traffic.

One way to compensate while making tight turns is to have the cranks nearly horizontal with the outside foot back and ratchet the cranks 90° or so as needed to maintain forward motion while you turn.