And if it wasn't obvious we need the new pic. Like......NOW!
FWIW, one possible reason this might work for you now is that you weren't necessarily reaching too far at first, it was just a change from whatever bike you were used to.
Flipping the stem *will* put it further away from you, however, it is very slight and hip angle will certainly affect your ability to produce the kind of power you *were* used to much more than the slight distance further the bars will technically be from your hips.
If you look at a pro peloton, you will see bars all over the place. Some almost dead even with shoulders (waaay too short a top tube and/or too small a frame). Some so stretched out they almost need a chest pad on the top tube. They all make it work.
There's *ideal" in terms of fit and then there are the nearly endless possibilities in between *ideal* and *wtf are you doing?*.