What klx678 said!
I'm also on the shorter side of 5'7 with a 29 inch inseam. And I totally understand where you're coming from. I lowered mine with the forks, 2" lower links and shaved the seat. Could never get the seat quite right so I bought the Seat Concepts low model and am now much more comfortable for longer rides, however the low model isn't really that much lower. It does effect the suspension a little but nothing to worry about unless you're very agressive. Must say it increases my confidence on the trail being able to almost flat foot. One inch riser also brought the handlebars to an easier reach. As you get more confident, all can be reversed unless you shave the seat foam.

 

You can try this website to get an idea, it helped me when I was looking for a bike. Add few centimeters to your height because of riding boots.
Motorcycle Ergonomics

 

 

I am 5'7" on a tall day, and old. I have an '07, which is apparently a little taller than the new bikes, and I wasn't comfortable with the seat height. I swapped the seat out for a Seat Concepts which is lower and wider, and it has been great. I also installed lowering links and moved the forks up an inch or so. I have a little less travel, but I haven't noticed any negative handling effects. Maybe I'm just too dumb to know the difference, but the seat and lowering links made a huge positive difference for me. Welcome to the club, fellow short guy!

 

If lowering is relatively equal front/rear you will not notice any change. It takes some serious differences to actually be negative... not different, but negative. I raised the rear of my Zephyr 550 by about 2", then ran a lower profile front tire dropping it about 1/2-3/4". That changed the handling dramatically. For some it might have been negative, but for me it did exactly what I wanted. i t quickened the steering, making it turn in like my 650, which was borderline supermoto quick. Makes it a bit nervous feeling for some, but just what I like. When I rode it as stock it steered like a truck in my opinion - slow and ponderous - in spite of a reputation for near sport bike handling.

So not all change is negative.

 

All good advice here. I rode an old 86 model Honda trials bike for many a year and was so used to a low seat height in the woods that the KLX height felt intimidating to me (30" inseam). You can only raise the forks in the triple clamps 7/8's of an inch and I bought a 1" lowering link from DeVol, so I may have changed the rake a bit but not much. Now after riding a while I have went back to the stock linkage. I just needed some seat time to acclimate and I want the linkage leverage rate to remain as designed. As mentioned, I mount the bike with the kickstand down by stepping up and over from the left peg. I'd like to see the 1" lower seat concept seat... Best option would be to have a suspension shop like Racetech or somebody internally lower the fork and shock to the height desired. Next best would be what I did, both are reversible. The seat concepts seat requires you to use your seat pan so to go back you would have to re-staple the original foam and cover to the pan. Now that I'm back to stock height I just need to work on my off camber hill bailing technique hehe.

 

Here's another option for us short folk!

 

That's just wrong..