Demons often mistake her for a child. Which is categorically, unevoquically, definitely incorrect – she died at the age of 22 – but it's not too big of a deal, really.
Niffty's small stature aids her in cleaning – to get into all the tight corners, nooks and crannies where dust and grime gather. It's good that she can reach all those places. To leave any of them filthy (as a bigger demon might) would be a big NOPE.
It also helps her allay any suspicion when Alastor employs her to do a… different sort of cleaning. No-one seems to expect a diminutive bug in a dress to have such a bite – and Niffty does confess she relishes their fleeting surprise. Even though it's probably rather unladylike.
Sure, there are some instances where she gets literally overlooked. Where she can't reach something very high-up and too tricky to scramble or bounce up to. But still, she's not fussed. Those are few and far between, and when it does happen that Niffty's height holds her back…
She's got friends who she can count on to lift her up if she needs it. Al, with his perpetual smile; Husk, grumpily (but not really) obliging. Princess Charlie; extroverted & hospitable; no-nonsense, pragmatic Vaggie; and Miss Angel Dust, ever personable and chatty…
With them, Niffty doesn't feel small.