Re:
If you are feeling uncomfortable and are unsure about the stem length, I would suggest to ask friends or a bike shop if they can lend you a longer version. Alternatively invest a bit an buy a (very) used stem. If it fits, get a nicer one later. I did that and over time have 6 or 7 cheap stems to test around. Bought the cheapest no-name one I could find. Cost max 5GBP a piece. You can also try to flip the stem, giving you a rise instead of a drop.
Other than that, the only thing I see in your bike that could be changed is the seatpost. Yours has an offest and the seat is all the way to the front. A straight post (zero offset) would bring you more forward. You don't want your body center to be too far up front though (unless you are using aero-bars).
A flat bar will not change much. It's the same position as when you have your hands on the top part of your drop bar.
What crank length do you have? Could also be a cource of discomfort. Should be max 170mm on such a small sized bike.