If it makes you feel any better I regularly ride a 16.5" Cannondale in quite demanding offroad conditions, serious ascents, fairly serious descents, twisty switchbacks and fast singletrack and apart from the first few seconds when I feel like im on a Clown Bike I love it and like how it handles.
That has no layback but does have a 130mm stem (but so do all my bikes, regardless of size).
A proper sized bike for me would be an 18" with as near to a 23" top tube as I can get.
'Glaciers move faster than my build projects..Meh!'My Wanted list My BLOG! Pace Forks Timeline'91 Saracen Traverse Comp - '92 Funk Pro Comp - '92 Rocky Mountain Cirrus - '93 Cannondale M700 - '94 Eastern Woods Research OWB - '97 Pace RC200 F6