S'okay guys, she's actually a 10,000 year old dragon so it's totally fine!
Anywho, taking things situation by situation, and applying context to these situations, it was the correct move to make for a successful localization. Lin is a 13 (thirteen) year old girl (she is still 13 in the localization, there was a mix up by GameInformer). Making sure that she is less sexualized in countries with different (and IMO more approprite, but that's neither here nor there) sexual mores/laws is only a natural transition when a game is localized in order for the game to be as successful as possible.
And it's already shown that the team has this isn't a game wide change, and only affects Lin, who again is underage. The original outfit remains unchanged on a character such as Elma.
As for the proportion, methinks it's just a bad angle.
Here's the same (shortened) angle in the Japanese version:
Definitely looks more stumpy than the correct angle. :P
