Yes as the M-Bars on an S-stem will hit the ground when folded. Stems are specific to the bars (except that M and H both use the same bars). You can exchange the S-bars with generic riser bars and gain height that way. The maximum rise for those bars would be 10cm, but only if you stay at the same width as the original bars. If you go wider you must stay lower. Trouble is that most riser bars use a big area for the rise, so if you cut them down to the width of the Brompton bars you'll end up with too little space (flat area) for grips, brake-levers and so on. There are however some bars that will work flawlessly. The other option is to use a riser like the "AberHallo" or alike with your S-bars.

Exchanging the stem and the bars to M (or any other model) is in most cases not a good idea as it is very expensive if you do not manage to get hold of used parts. Therefor in most cases it is cheaper to sell the bike and get one with the bars you want. If you have customized your bike already it may look different.