I'll say that I do think he looks a bit too small in his idle stance. I agree that it would have been much more preferable if his eye level was above Samus. That being said, since his full height upright is much taller, I think that in motion, he looks fine since he's much more stretched out while attacking and moving and whatnot.
I think a big part that makes his model look good in Smash is his wingspan. It's very wide when at its full length and I think it plays a big part in making Ridley feel imposing. Personally, I've always thought that a wide wingspan gives any character design a very imposing presence, and I believe that's definitely the case for Ridley. When his wings are outstretched while he's attacking,, jumping, or even being launched, it gives him a bigger presence than he would have otherwise. I think that's what keeps him from looking too small, especially in comparison to Samus.
I honestly resent the statements like"Ridley just doesn't work in Smash," "He looks dumb/********/whatever," "That's not Ridley." Of course a ideal Ridley is very big, but taking liberties with designs in Smash is nothing new. I really don't think that this bastardizes his character the way people say because ironically, I feel his character is better represented here than in a fair amount of Metroid games. His fighting style is brutal, cunning, and cruel, which I feel is represented well in his attacks and animations. Such as dragging opponents across the floor, aiming a tail strike to stab right where his hurts, and so on. He comes across as bestial and monstrous, and yet not a mindless beast, which is an impression that some people might get from some of his boss fights.
I would even argue that Ridley's character is captured better in Smash than Bowser is. I feel like Smash Bros under-emphasizes Bowser's goofiness and charm in favor of making him more of a stern and ferocious beast. It does work for the most part, but when I compare Bowser's Smash model, which looks like it's scowling by default, to his model in games like 3D World and Odyssey, where his model appears to be smirking by default, I dunno. Being battle-ready and serious isn't necessarily outside the realms of Bowser's character, but I feel like his pompous, boastful attitude as seen in many games isn't fully realized in Smash compared to Ridley's intelligence, cruelty, and brutality, which I feel is captured well for reasons already stated.