Agreed that the bike is too small for you, and the difference between seat and hb height is not the only consideration. A larger frame is also slightly longer from seat to bars, and believe it or not that will probably be more comfortable. As it is your arms will be more close to vertical and combined with a lower position you will be putting more direct pressure on your hands.

Also whether the seat height is correct depends on what shoes you are wearing when you ride and whether you tend to pedal flat or toes down. I take a lower position than one might expect because my feet are fairly level when I pedal.

When adjusting seat height forget about any percentage of leg length. People are notoriously unable to get a consistent measurement of inseam, and the "ideal' percentage varies from the .883 mentioned above to 109% of inseam that was the popular figure years ago. The method I have used for years as a starting point is as follows: With your cycling shoes on place the heel of one foot on a pedal. Let the other leg hang to keep your hips level. Your heel should just touch the pedal. As with any method that is just a starting point due both to the above issue and to variations in shoe and cleat design. Once you have that starting point you can adjust up and down to suit, as long as you don't go high enough to induce rocking your hips when pedaling. You can also find info with a Google search on adjusting height by measuring the angle at the knee when at the bottom of the pedal stroke, but I think that's going a bit overboard unless you are a high performance rider.

Again, make sure you address fore-aft seat position as well, especially before deciding on changes in handlebar and stem.