Taller people tend to earn more on average, although the effect is modest. This is clearly true in occupations where strength is important but also a relationship exists in other occupations as well. It could be perceptions, as you say or something systematic. It's somewhat of a mystery.

Being shorter or taller depends on details of the diet. Vegetarians can obtain a balanced diet, with sufficient complete protein, vitamins, minerals and micro-nutrients. It's trickier for vegans but it can be done.

There are some effects of the biome. Compact bodies tend to conserve heat relative to linear ones. This can affect average height as well as body proportions. The study participants Europeans and Americans do not fall into the range where this effect is powerful, however.

All the Americans in the study were native born, but the height of the mother does affect the growth potential of the child. So, there is a second generation effect. But this can explain only a small portion of the height difference between Americans and northern Europeans. Regarless of continent of origin, children who grow up under conditions of good health and nutrition are about the same height, on average.

Africans are not as tall as northern Europeans. But Manute Vol and other sports figures in basketball and football receive a lot of press coverage.

The second and third generation effect of immigration accounts for only a small portion of the height shortfall between Americans and northern Europeans. Besides the slowdown in American heights began in the 1950s, well before large-scale immigration into the country.

The English were relatively short in the mid-nineteenth century and so their expeditions return with stories some exaggerated, not doubt about "giants" who lived in other parts of the world.